Cigarettes. Hard drugs. Handing out electric vehicle (EV) battery plant subsidies. All of these are, apparently, highly addictive. What happened: The federal and Ontario governments have pledged nearly $1 billion in subsidies for a plant in Loyalist Township from Belgian EV battery group Umicore. Why it matters: Umicore specializes in cathode active materials, which are used in the most expensive part of standard EV batteries ( the cathode ). Its Ontario plant will be the "first of its kind" in North America, giving Canada a leg up in this vital niche in the EV supply chain. Zoom out: Southern Ontario is styling itself as the heartbeat of North America's EV battery industry. The Umicore plant is the province's third multi-billion dollar factory announcement of the year, following massive subsidy deals struck with Volkswagen and Stellantis/LG. Yes, but: The investments won't pay off at all if imagined EV demand doesn't become a reality.