Canada’s Linamar to break ground on new plant ‘immediately’

canadian car supplier Linamar Co., Ltd. It will break ground “immediately” on a new plant in Welland, Ontario, which will house three Giga casting presses capable of producing very large aluminum structural parts. Electric car.

The Guelph, Ontario-based parts supplier announced a new location in the city south of Niagara Falls when it reported first-quarter earnings on Wednesday.

The company’s CEO, Linda Hasenflatz, said the state-of-the-art plant will be the “mainstay” of the company’s structural castings business.

“As the first supplier to invest in this equipment in North America, Linamar will naturally be the market leader in this technology,” he told analysts on a conference call Wednesday.

Developed by Tesla, the GigaPress is used to manufacture large structural parts for vehicles, replacing parts that previously required numerous welds with a single piece of aluminum.

Linamar COO Jim Jarrell said the investment is the next step in the company’s high pressure die casting strategy and follows the “rising trend” of cast aluminum in vehicle construction.

“Welland’s Giga foundry facility has capabilities that few companies in the world possess. is reduced, creating a more lightweight solution.”

Linamar said the new plant will be equipped with three 6,100-ton high-pressure die-casting machines.

“To date, tonnage from suppliers of parts of this size exists only in Asia, making it impossible to ship parts of this size from Asia,” Hasenflatz said on the earnings call.

The first of the three Giga presses will be installed in January 2024.

“Production on the first contract [will be] We started about a year after that,” Hasenflatz added. He declined to name the first customer, but said the company has received “great interest” from automakers.

Linamar didn’t disclose the exact amount of its investment in Welland, but Hasenflatz said the company’s capital expenditures were up from C$411 million (US$305 million) spent across its global operations last year. “significantly increased,” with Welland’s facilities accounting for the “majority.” The company spent C$162.7 million on capital expenditures in the first quarter of 2023.

According to the city of Welland, the new plant will be built at 59 Canal Bank Street, which was once part of Union Carbide’s electrode production plant that closed in 1999 and the Page Hershey plant that later passed through.・This is the site of a brownfield that used to be a pipe factory. Owners, including steel maker Stelco, have been on the rise. These days he was known as Energex Tube until it closed in 2014.

“Linamar’s presence in our community signals the next wave of investment in our local economy and is a testament to the progressive steps the City of Welland is taking,” Mayor Frank Campion said in a release. There is,” he said.

According to the city, the plant will have an area of ​​about 300,000 square feet and will employ about 200 people.

Linamar said construction will begin immediately at Welland and parts production will begin in February 2025.

among them First Quarter Earnings Report, the supplier said sales increased 29% to C$2.29 billion, a new record for a quarter. Linamar said earnings before interest, taxes, depreciation and amortization were C$297.1 million, up 41% from C$210.8 million in the same period last year.

Future efforts continued to trend toward EVs. Nearly 80% of Linamar’s contracts won in the quarter were for EV or propulsion independent components. The company expects the segment to account for half of its business by 2027.