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Message: Billions for the battery sector-In Quebec
Billions for the battery sector
PHOTO DAVID BOILY, THE PRESS
Guy LeBlanc, President and CEO of Investissement Québec, Bicha Ngo, Senior Executive Vice-President, Private Investments, and Alexandre Sieber, Senior Executive Vice-President, Corporate Finance.
Investissement Québec clarifies its strategy. As part of an editorial meeting with La Presse , the leaders stressed that they wanted to place Quebec in the leading pack in the manufacture and assembly of batteries for electric vehicles.
ANDRÉ DUBUCPRESS
MAXIME BERGERONPRESS
HUGO JONCASPRESS
The investor arm of the provincial government will step on the accelerator to quickly place Quebec in the leading peloton of hubs in the manufacture and assembly of lithium-ion batteries equipping electric vehicles in North America.
In the immediate future, however, government interventionism in favor of the electric bus manufacturer Lion, of Saint-Jérôme, arouses the ire of traditional school bus manufacturers like Girardin and Thomas, of Drummondville, who fear a drop in their turnover (see screen 4).
The CEO of Investissement Québec (IQ), Guy LeBlanc, clarified his intervention strategy in the buoyant battery sector as part of an editorial meeting with La Presse on Tuesday.
On this occasion, the management of the state-owned company sought to explain the role and activities of the new IQ since the integration of 400 officials from the Center de recherche industrielle du Québec and the Ministry of Economy and Innovation. . It also discussed the treatment of Chinese investment projects, the local transformation of natural resources and sustainable development that IQ intends to place at the heart of its investment decisions (see other texts).
PHOTO DAVID BOILY, THE PRESS
Guy LeBlanc, President and CEO
We plan to invest between 1 and 2 billion public funds with 4 to 6 billion private investments. It's going to happen over the next two or three years.
Guy LeBlanc, CEO of Investissement Québec
“We hope to be able to make important announcements over the next six to twelve months with international expertise in each component of the chain,” he adds.
Why this craze? A study commissioned in 2019 by Propulsion Québec, an electric and intelligent transport cluster, urged the government to quickly position Quebec as a hub of the sector called to experience dizzying growth due to the popularity of electric vehicles. Quebec has the great advantage of being able to produce batteries with clean energy, a valuable attribute at a time when manufacturers are seeking to reduce their carbon footprint.
"[The development of the lithium-ion battery industry] has the potential to act as a real engine of economic development for Quebec and its regions, provided that this opportunity is quickly seized", it read.
A billion required at each stage
The levels of the sector are the extraction of resources such as lithium graphite and spodumene, the transformation of the material into “battery” quality components, the manufacture of anodes and cathodes, the assembly of battery cells, then the manufacture of battery modules.
At each stage, the order of magnitude of the investments, roughly speaking, is 1 billion. “To turn spodumene into [battery-grade] lithium,” says LeBlanc, “it's $ 1 billion. To make cathodes, it takes 1 billion. To manufacture the cells, it is a major investment depending on the production capacity. In a first phase, it takes 1 billion. "
For example, Nouveau Monde Graphite has just awarded the engineering contract to BBA for the preparation of the final feasibility study of its commercial 700 million graphite purification and coating plant that it plans to build at the industrial park. provincial in Bécancour.
IQ is a shareholder in Nouveau Monde, but also in Mason Graphite and Nemaska Lithium. The latter announced in early June that it had reserved land for its spodumene processing plant in Bécancour. IQ is also a partner in Lithium North America.
The industry would not be complete without recycling batteries, insists Mr. LeBlanc. “For electricity to make a difference in terms of GHG [greenhouse gases], the important thing is to recycle batteries. There will be no chain without recycling and we are already having discussions with partners. "
At the same time, Mr. LeBlanc deplores the total absence of companies active in the recycling of aluminum in Quebec. “We send it to Ontario and the United States. This is nonsense. You have to have a recycling capacity, you have to have the processing capacity. It is important to invest. "
Invest in Quebec ... and move your employees there
PHOTO DAVID BOILY, THE PRESS
Bicha Ngo, Senior Executive Vice-President, Private Investments, at Investissement Québec
Last March, Investissement Québec (IQ) announced with great fanfare a loan of $ 55 million to the Californian company Appdirect, which aims to create 730 “quality” jobs in Montreal within five years.
The flip side of this good news? Montreal employers are already snapping up the rare high-tech workers available. The shortage is such that IQ has started discussions with Appdirect… with a view to moving some of the employees from San Francisco to the metropolis!
“How do we speed up this process, and how do we open the doors, in a way, to those companies that actually want to move people to Quebec? », Exposed Bicha Ngo, senior executive vice-president, private placements, at IQ, in an editorial interview with La Presse .
The example of Appdirect - a digital commerce company - illustrates the immense challenge facing the financial arm of the Quebec state today.
IQ must continue to attract foreign investment and try to create the “quality” jobs demanded by the Legault government. But the group must fulfill this mission in a context of extreme labor scarcity, and which will continue to increase.
More immigration?
Business leaders with whom La Presse spoke this week are calling for an increase in immigration targets in Quebec. They are between 44,500 and 47,500 this year (plus a catch of 7,000 due to the pandemic) and 49,500 to 52,500 next year.
Guy LeBlanc, big boss of IQ, does not believe he has a great power of influence to move these targets. “We meet with the Prime Minister every two weeks. There are certainly discussions, but the levers are all in the same place, at the government level. "
Where IQ can make a difference, he says, is in "attracting skilled workers."
"There is a lack, particularly in the regions, of manpower, of more specialized talents in technology, of engineers and technicians," says Guy LeBlanc. And this is more where we focus, with the organizations Montreal International, Quebec International and also Drummondville, which has its team. "
The recruitment missions carried out abroad by these organizations, with the support of IQ, attracted 3,000 specialized workers in 2019 and 2,242 last year.
And what about jobs requiring less formal education, for example in agriculture, for which the shortage is just as glaring? Guy LeBlanc estimates that they can be partially filled by the "200,000 people and more" who these days receive state benefits due to COVID-19. "As soon as it goes away, we risk having more listening on the part of these people, who perhaps prefer to stay away today," he says.
The establishment of many requalification programs by Quebec in recent months will allow many of them to retrain in jobs in demand, hopes the CEO.
Automating
The other great remedy for the labor shortage is through automation and robotization, underlines Alexandre Sieber, senior executive vice-president, corporate finance at IQ. He cites the example of an Abitibi-based mining company, Plastiques G +, which recently benefited from the expertise of CRIQ, an innovation-driven branch of IQ.
“Before, in a week, they were able to do 250 conduits, and that took seven resources,” says Sieber. Three months later, once the technology was brought in, the same 250 ducts, that's one week, one employee. The other six were reassigned to places where the company needed them. "
Some 28% of projects funded by IQ in the past year were aimed at increasing business productivity, including through automation.
Two business leaders who have recently benefited from IQ's support share their difficulties in recruiting workers.
VINCENT GODIN
• Owner of Emblème Cranberry • Investment of 12 million to modernize its facilities and create 20 jobs
The Sainte-Eulalie entrepreneur speaks of an "extremely difficult" and even "perilous" situation when recruiting new employees. While it can benefit from the presence of temporary foreign workers during the berry harvest, things get tough when the time comes to recruit factory laborers or more specialized employees. “An electromechanic job is downright impossible to find in the region. We managed to get one from Colombia, and it took almost two years. He believes that Quebec should further open the floodgates of immigration. “I saw Prime Minister Legault talk about reception capacity, say that Quebec has been reached. I am far from being a specialist in accommodation capacity, but if it is reached, I think we have to start working to increase it, this capacity. "
JEAN-NOEL FUNNY
• Chairman of Coractive • Investment of 34 million for the construction of a factory and the creation of 30 jobs
The big boss of the Quebec fiber optic manufacturing company does not hide it: the labor shortage is a major "source of concern". Installed in a city where full employment has been a reality for years now, Coractive has completely revised its way of recruiting, he explains. “Instead of devising a six-month to one-year recruiting plan, we make a one-and-a-half to two-year plan. It is treated the same as an investment in a new machine or new technology. We are also looking at how to recruit internationally. "Of the 65 employees of the group, 30% were not born in Quebec or Canada, underlines Mr. Marrant. He expects to have to look to other countries to fill some of the 30 positions that will follow the new investment by 2023. “This is an option that will have to be taken very seriously. "
APPDIRECT MASS HIRE
If discussions are taking place for a "possible" move of Appdirect employees from San Francisco to Montreal, according to Investissement Quebec, the company says that hiring is going well in the metropolis. Of the 730 positions that the group has committed to creating within the next five years, 94 have been filled since the start of the year, and the company estimates that it will be able to fill 80 more by the end. 2021, says Renée Bergeron, vice-president and general manager of Appsmart, a subsidiary of Appdirect. These are jobs "affecting all areas, from software engineering to marketing, including finance and human resources". Appdirect already has 190 employees since its installation in the metropolis five years ago. The company received a repayable loan from Investissement Québec for a maximum amount of 54.8 million last March. A “pardon” on interest will be granted if the job target is reached.
IQ on its guard with China
PHOTO DAVID BOILY, THE PRESS
Alexandre Sieber, Senior Senior Vice-President, Corporate Financing at Investissement Québec
Investissement Québec is more on its guard when Chinese companies come forward to work with its clients. With the proliferation of cases of industrial espionage, the state-owned company is redoubling its precautions.
Investissement Quebec (IQ) must now do checks "at an increased level" to protect the intellectual property of its clients before engaging with Chinese investors, according to Alexandre Sieber, senior senior vice-president, corporate finance.
It is a responsibility of companies, and we must support them in this, give them our opinion and perhaps certain avenues, certain solutions. But it's still a risk.
Alexandre Sieber, Senior Senior Vice-President, Corporate Financing at Investissement Québec
Same thing in the other direction, when the investments take place here, indicates Guy LeBlanc. "For Chinese investments in Quebec, it is certain that there are discussions that must take place with the federal government to ensure that the authorizations will be given when it comes to major projects", explains the CEO of IQ.
Aim for transformation
Because the interest of Chinese industrialists for investments in Quebec has remained intact. "They are very seeking our resources," said the boss of the crown corporation. But IQ, for its part, will be more selective, especially in the lithium and graphite battery sector. “Anything that was spodumene, which you can turn into lithium… The spodumene ships leaving for China… That's it. "
It refers to North American Lithium in Abitibi. The mine was under the control of Chinese company Jien International Investment Limited until it came under the protection of the Companies' Creditors Arrangement Act in 2019.
IQ, the company's largest creditor, took over the company. Quebec announced on May 27 an agreement with the Australians Sayona Mining Limited and Piedmont Lithium for the resumption of activities, subject to a commitment to develop a sector to transform spodumene in Quebec (see other text).
The Crown corporation is taking a similar approach for the relaunch of Nemaska Lithium.
At the Quebec Mining Association, CEO Josée Méthot understands the Crown corporation's approach.
In the case of graphite and lithium, it is normal that we want to transform here if we want to develop the battery sector here.
Josée Méthot, CEO of the Quebec Mining Association
A specialist in mining engineering and professor emeritus at the University of Quebec in Montreal, Michel Jébrak also believes that the state corporation "is right" to demand transformation. “The Chinese strategy is clear, it is to control the transformation of lithium (or carbon, or cobalt…) into chemicals […]. Then, once it controls this supply (and therefore the price), it goes upmarket, moving to cathodes, then cells, batteries… and vehicles! "
A challenge
Quebec would be wrong, however, to underestimate the challenge that transformation represents. "We have to produce at the best price, otherwise we will be invaded by Chinese products," says Michel Jébrak.
In lithium, manufacturers must also succeed in producing a product of very high purity, says the professor. And this, while limiting the damage to the environment in Quebec, where the standards are much more severe than in China.
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