Volkswagen Group, its battery subsidiary PowerCo SE and Gotion High-tech have expanded their battery production partnership, with an agreement to establish joint ventures in Spain, Slovakia and Morocco.
The agreement will see facilities covering lithium iron phosphate (LFP) battery-cell production developed in Valencia, Spain and Šurany, Slovakia, while Kenitra, Morocco will house a cathode-material operation. It also includes joint procurement and sales activities in Europe.
The moves form part of a wider strategy by the groups to ‘jointly accelerate the development of a regional battery supply chain for Europe’.
‘Major breakthrough’
“I am delighted that we are expanding our long-standing partnership with Gotion into the joint industrial production of LFP batteries to strengthen Europe’s battery industry,” commented Thomas Schmall, member of the board of management of Volkswagen Group for technology and chairman of the supervisory board of PowerCo SE.
“This marks a major breakthrough for both companies and brings us one step closer to the forefront of electric mobility. Volkswagen is the first European automotive manufacturer to cover the entire battery value chain, from development and cathode materials through to production.”
As the groups noted, the market share of LFP batteries is expected to rise from around 10% today to between 40% and 60% by 2030, with Europe currently lacking LFP battery production capacity.
Project structure
The largest project under the partnership, in Valencia, is being positioned as a future ‘European production hub for unified LFP battery cells’, and will be 51% owned by PowerCo and 49% by Gotion.
The companies also plan a joint venture around Gotion’s battery project in Šurany, Slovakia, with Gotion holding a 51% majority stake, to PowerCo’s 49%, while a similar structure will be maintained at Kentira. The Morocco project will supply cathode material to the two European battery operations.
Li Zhen, chairman of Gotion Hith-tech said that the latest announcement follows “six years of close collaboration” between Volkswagen and Gotion.
“Through cross-shareholdings and three joint sites, we are anchoring our shared strategy to localise battery production in Europe, racing to seize the opportunities of global electric mobility, and jointly forging a new paradigm of world-class, win-win cooperation in the lithium battery industry,” he commented. Read more here.
