The company has also announced an investment of €2bn for the construction and operation of the Salzgitter gigafactory


Volkswagen also plans to build six gigafactories in Europe. (Credit: Volkswagen AG)

German automobiles company Volkswagen has created a new European company to consolidate its battery value chain activities.

The new company has been established to bundle all the activities from processing raw materials to developing a unified Volkswagen battery to managing the European gigafactories.

Its business models will be based around reusing car batteries that are no longer used and recycling the valuable raw materials present in them.

Volkswagen also plans to build six gigafactories in Europe to meet the internal group demand for battery cells.

The gigafactory in Salzgitter, Lower Saxony, is expected to start producing unified battery cells for the Volkswagen Group’s volume segment in 2025.

The facility will have an annual capacity of 20GWh in the initial phase and the capacity is planned to be doubled later.

Volkswagen will make a total investment of €2bn for the construction and operation of the Salzgitter gigafactory. The facility is expected to create jobs for more than 2,500 people.

The site in Salzgitter is anticipated to become the Volkswagen Group’s battery centre, as it brings together development, planning and production control under one roof.

Volkswagen is planning to construct additional gigafactories at sites in Spain and Eastern Europe. The company will finalise the locations for the third and fourth gigafactories in the first half of next year.

The company is also expected to open two more battery cell factories in Europe by 2030.

Northvolt, in which Volkswagen owns a 20% stake, will construct an additional factory in Skellefteå in northern Sweden. The Swedish start-up’s new facility is expected to start producing battery cells for the premium automotive segment in 2023.

Volkswagen already has a partnership with Northvolt in the area of premium battery cells.

The automotive manufacturing company has also recently announced partnerships with Umicore and 24M as well as a long-term supply agreement with Vulcan Energy Resources.