The decision to expand its battery company PowerCo's cell production from Europe to Canada comes as a part of its strategies to scale up the global battery business along with localising cell production and setting up a new value chain
German automobile major Volkswagen Group has selected St. Thomas in Ontario, Canada to develop the company’s first gigafactory for electric vehicle (EV) battery production outside Europe.
The decision to expand its battery company PowerCo’s cell production from Europe to Canada comes as a part of its strategies to scale up the global battery business along with localising cell production and setting up a new value chain.
Volkswagen’s first gigafactory in North America is expected to produce sustainable unified cells in 2027.
The new EV battery manufacturing plant will feature the automotive major’s BEVs in the region with advanced battery cells, said Volkswagen.
Canada Minister of Innovation, Science and Industry François-Philippe Champagne said: “Today’s announcement by Volkswagen is a true testament to our highly skilled workforce and Canada’s strong and growing battery ecosystem.
“VW’s decision to establish its first overseas gigafactory in Canada speaks to our country’s competitiveness when it comes to attracting major investments. It is also a vote of confidence in Canada as the green supplier of choice to the world.
“With Volkswagen and PowerCo, our government looks forward to working together towards a cleaner, more sustainable and resilient economy.”
Volkswagen’s new battery production plant is part of the larger strategy agreed upon by the company and PowerCo with Canadian Prime Minister Justin Trudeau’s government in August 2022.
In this regard, both parties signed a memorandum of understanding (MoU), which focuses on raw material security and battery value creation to advance e-mobility in the country.
Volkswagen Group CEO Oliver Blume said: “Our North American strategy is a key priority in our 10-point-plan that we’ve laid out last year. With the decisions for cell production in Canada and a Scout site in South Carolina, we’re fast-forwarding the execution of our North American strategy.”
The announcement of the gigafactory in Canada comes after Scout decides to develop a car plant in the US last week.
In July last year, Volkswagen started construction on its €2bn gigafactory in Salzgitter, Germany with a target to begin production in 2025.