With the supply chains in a rut, wars ravaging and a shortage of essential tech supplies wreaking havoc on EV battery component prices, many automakers are thinking ahead and scrambling to secure not only stocks of valuable metals like cobalt, lithium and nickel that go into EV batteries but also the means of building the batteries themselves. On Thursday, VW Group held a groundbreaking at the site of its upcoming EV battery cell plant in Salzgitter Germany and announced the formation of a new company, PowerCo, which will be responsible for handling the VW Group’s burgeoning battery business.
“Today is a good day for the automotive industry in Germany and Europe,” German Chancellor Olaf Scholz said during the event. “Volkswagen is showing how the future of sustainable, climate-compatible mobility could look. Together, we are laying the foundation for shaping this future to a significant extent in Salzgitter.”
PowerCo will manage the group’s global battery activities, from producing the batteries themselves to leading R&D on new battery technologies to “products such as major storage systems for the energy grid,” according to the announcement. Once the Salzgitter plant is operational, PowerCo will begin work on the second factory in Valencia, Spain with an eye on three further cell factories in Europe and potentially North America as well. Each of the European factories will reportedly operate using 100 per cent renewable energy. In all, PowerCo aims to open a total of six battery factories in Europe producing a total of 240 GWh capacity every year, which will help VW meet its 2030 goal of having at least half its lineup be EVs.
The plant is expected to create 5,000 new jobs when it begins operations in 2025 with an annual capacity of 40 GWh. Almost 20,000 positions will need to be filled once the other European factories open, Daniela Cavallo, Chairwoman of the General and Group Works Council of Volkswagen AG, said.
