Enormous $7 billion 'gigafactory' to open in Ontario in 2027

A gargantuan Volkswagen "gigafactory" recently kicked off construction in Ontario, throwing a potential lifeline to a regional auto industry pushed to the brink by U.S. trade tariffs.

Workers mobilized on the sprawling 350-acre site of the future $7 billion Volkswagen PowerCo facility in St. Thomas, Ont., in late October, launching construction work for the colossal new electric vehicle battery plant with an official ground breaking celebration.

The Oct. 28 ground breaking — which included the first concrete pours for the new facility — marked the first major step in the plant's journey towards a projected 2027 completion.

Frank Blome, CEO of PowerCo SE, called October's ground breaking "a big milestone," and stated the project is "positioning Canada at the forefront of innovative EV battery production."

The plant was first announced back in March 2023, and is being billed as Canada's largest electric vehicle battery plant, as well as PowerCo's (a subsidiary of the Volkswagen Group) third-largest project globally.

The project's importance to Ontario's struggling auto sector is as immense as the building's footprint. That value has only grown since March 2025, when U.S. President Donald Trump began to roll out harsh tariffs on Canadian industries.

Much of the province's auto sector is built around manufacturing for U.S. car brands, though the construction of major infrastructure to support European car manufacturers allows Ontario to tap into a new tariff-exempt sector of the auto market.

And with a projected 3,000 workers to be employed directly by the plant — not even factoring in the construction jobs to build the new facility — the battery factory stands to be a huge contributor to manufacturing jobs in the region.

A hiring drive was held earlier this year for the gigafactory, and continues to hire for positions, bringing a vast employment boost to St. Thomas, a town with just 43,000 residents.

At the time of the hiring drive's launch earlier this year, St. Thomas Mayor Joe Preston said the investment "isn't just an economic boost; it's a fundamental transformation for our community."

"We're proud to be the home for this exciting new chapter in Canada's burgeoning EV battery manufacturing sector," said Preston back in August.

It was just over two months later that shovels would hit the ground for the new plant, ushering in a new era for the small Ontario town.

"The excitement in St. Thomas is palpable, as we celebrate this monumental construction milestone," said Preston of the ground breaking last month.

"The St. Thomas gigafactory is rapidly coming to life and already delivering on its promise of prosperity — supporting hundreds of local jobs and providing a significant boost to our economy right here in our community."

And the timing really couldn't be better for an industry in a tough position. The outlook for the short term is pretty bleak, and the federal government's budget presented in November 2025 has already been met with criticism from the auto sector.

The completed facility — set to open in less than two years — will serve as the North American base for PowerCo's advanced battery technology, offering some balance to the job losses and factory closures that could be on the horizon for manufacturers working assembly lines for U.S. auto brands.