Volkswagen declares $20 billion effort to construct its personal EV batteries

Volkswagen mentioned it could make investments $20.38 billion to construct electrical car batteries, a transfer the corporate says will create 20,000 jobs and generate $20.38 billion in annual gross sales. The automaker will create a brand new firm known as Energy Co to supervise the huge effort as VW races to safe sufficient capability, supplies, and provides to energy its EV ambitions.

Energy Co will handle VW’s complete battery provide chain, from analysis and improvement of recent applied sciences to the mining of the uncooked supplies to end-of-life recycling. The information was introduced at a groundbreaking ceremony for the corporate’s first battery plant in Salzgitter, a metropolis in Germany’s Decrease Saxony.

“The battery cell enterprise is likely one of the cornerstones of our New Auto technique which can make Volkswagen a number one supplier of the sustainable, software-driven mobility of tomorrow,” VW CEO Herbert Diess mentioned in a press release. “Establishing our personal cell manufacturing facility is a megaproject in technical and financial phrases. It exhibits that we’re bringing the modern expertise of the longer term to Germany!”

Final yr, VW unveiled plans to construct six battery cell manufacturing crops in Europe by 2030, together with the ability in Salzgitter and one in Skelleftea, Sweden. A 3rd plant can be established in Valencia, Spain, and the fourth manufacturing facility can be based mostly in Japanese Europe. The corporate can also be exploring plans to construct future gigafactories in North America. The crops will ultimately have a manufacturing capability of 240 gigawatt-hours a yr.

Picture: VW

Beginning in 2023, VW plans to roll out a brand new unified prismatic cell design of its batteries that can be put in throughout the automaker’s manufacturers. The aim is to have this unified cell design powering as much as 80 p.c of VW’s electrical autos by 2030. VW additionally has contracts with two different main battery producers, Samsung and CATL. And the corporate is backing a startup based mostly in San Jose, California, QuantumScape, which is engaged on extra energy-efficient solid-state batteries.

VW isn’t the one automaker to see vertical integration as a key element to EV success. Ford is constructing three new battery crops that it says can have 129 GWh a yr of manufacturing capability. Normal Motors is planning 4 new battery factories within the US with LG Chem for a complete annual capability of 140 GWh. Stellantis is constructing a $2.5 billion battery plant in Indiana, and Hyundai and Toyota have additionally introduced cell manufacturing plans within the US.

VW, which is the second-largest automaker on the earth based mostly on quantity, has run into headwinds in its shift to electrical autos. Diess not too long ago mentioned that the corporate was “principally offered out on electrical autos in Europe and in the USA for the yr,” which signifies that anybody hoping to get an EV from VW, Audi, or any of the group’s different manufacturers might have to attend till 2023, as the corporate tries to navigate the chip scarcity and manufacturing points from COVID shutdowns in China.