Sep 12, 2023
By Jeremy Logan
According to the parliamentary budget officer, it will take the federal government until 2043 to break even on its deals with two automotive giants.
The federal government announced subsidies for Volkswagen, Stellantis and LG Energy Solution this year, in a bid to entice them to build electric vehicle battery plants in Canada.
The PBO says it is going to take 20 years for government revenues generated from the production of both plants to equal the production subsidies, which total about $28.2 billion.
The budget watchdog’s calculations don’t include any potential revenue that may be generated across the supply chain.
This is in contrast to the federal government’s five-year break-even calculation for the Volkswagen deal, which includes expected revenue from production increases across the supply chain.
The federal government has not yet provided a break-even estimate for the Stellantis deal.