Volkswagen Group And powercoIts battery company, has chosen Canada for its first overseas battery cell factory.
Volkswagen Group said the plant, located in St. Thomas, Ontario, will produce battery cells starting in 2027.
The company launched Powerco last summer. Powerco will now be in charge of the global battery business. Volkswagen Group said in a Press release Canada offers ideal conditions with a local supply of raw materials and widespread access to clean electricity.
The factory in Canada is one of six that Volkswagen Group plans to build. It is part of a wider global plan to halve the cost of batteries. The company said the move is “part of a larger plan that Volkswagen and Powerco agreed upon with the government of Canadian Prime Minister Justin Trudeau last August.”
Other factories will be located in Europe, and construction has already begun at locations in Salzgitter, Germany, and Valencia, Spain. The Canadian location is the third factory, and the first in North America.
The company is calling this recent move into North America evidence of its “ambitious growth strategy” on the continent.
“Our North American strategy is a key priority in our 10-point-plan that we laid out last year. With decisions on cell production in Canada and a scout site in South Carolina, we are looking to rapidly accelerate the execution of our North American strategy. forward,” said Oliver Blume, chief executive officer of the Volkswagen Group.
The company says that more details about Gigafactory St. Thomas will be revealed in the near future.
François-Philippe Champagne, Canada’s Minister of Innovation, Science and Industry, called the announcement a “true testament” to Canada’s skilled workforce and growing battery ecosystem.
“VW’s decision to set up its first overseas gigafactory in Canada speaks to our country’s competitiveness when it comes to attracting large investments. It is also a vote of confidence in Canada as the green supplier of choice to the world. Together with Volkswagen and Powerco, our government looks forward to working together towards a cleaner, more sustainable and resilient economy,” he said.