It will take 20 years for the federal government to fulfill its pledge to provide $28.2 billion in production subsidies to automakers in St. Thomas and Windsor in southwestern Ontario, according to a report released Tuesday morning by the Parliamentary Budget Officer.

The report clarified that the Stellantis Legase battery plant in Windsor and the Volkswagen plant in St. Thomas will not be able to generate enough federal and provincial tax revenues to cover the total subsidies before 2043.

Yves Giroux, the Parliamentary Budget Officer, stated that this shows Ottawa is likely to have significantly underestimated the situation in the spring when it said it would support Volkswagen in less than five years.

He noted that such estimates assume widespread economic growth in the Canadian automotive sector due to the new plants, and his report offers more conservative estimates.

He told reporters today, "Our report is less optimistic and more realistic; if we end up being wrong, that's much better for the country. But I don't believe we will be that far off."

Ottawa pledged in the spring to provide Volkswagen with up to $13 billion in support over the next ten years to secure the battery plant in St. Thomas. The size of this plant will be equivalent to 391 football fields and will create jobs in the automotive sector for the region.

Stellantis halted construction at the Windsor plant this summer, stating that provincial and federal governments would need to provide more than the initial investment of $500 million, and construction resumed after the governments announced support of up to $15 billion.

This plant is expected to open in 2024 and will employ approximately 2,500 people.

Ottawa will cover two-thirds of the support, totaling $18.8 billion combined, for Stellantis and Volkswagen, while Ontario will provide $9.4 billion.

The Budget Officer's report indicates that Ontario has not yet announced a timeline for achieving breakeven for the stations. However, Giroux mentioned that it is likely to be the same as what occurred in Ottawa – about 20 years.

Jay Goldberg, spokesperson for the Canadian Taxpayers Federation, said Giroux was correct in providing conservative estimates regarding the boon these projects will bring to the Canadian automotive industry.

He stated that the way to handle such cases is to improve the economic climate for investment in Ontario, rather than offering massive financial subsidies.

"It’s important for governments to come out and say: We've reached our limit. No more corporate welfare. No more handouts."