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VW expects batteries, raw materials needed for EV shift to cost up to $34B

Automaker will seek outside partners to fund expansion

in Automotive News Europe / Reuters, 01-12-2021


Volkswagen Group’s new battery cell plants and securing vital raw materials will cost as much as 30 billion euros ($34 billion), board member Thomas Schmall said, putting a price tag on the expansion for the first time.

VW will seek outside partners to help fund the automaker’s push to open six large battery cell plants in Europe by the end of the decade, Schmall, who is in charge of technology at VW, said in an interview at the Reuters Next conference.

The battery cell push is a strategic pillar in the company’s bid to overtake Tesla and become the world’s top EV seller.

“We are talking about 25 to 30 billion (euros) … including the vertical chain of raw materials, not only the factories,” Schmall said.

VW would not have to take the lead on funding and was not aiming for a 50/50 investment split, he said. “It depends on the partnership model we will establish in the next months. We’re open to discuss it. For us it’s necessary that we can control … the technology roadmap, the timing, the costs and the availability to enable our rollout.”

Sweden’s Northvolt will start production premium cells for VW in 2023. The second plant, to be built jointly with China’s Gotion High-Tech in Salzgitter, Germany will start in 2025.

Four more plants will follow by the end of the decade, most likely in Spain, eastern Europe and two additional locations that have so far not been disclosed.

 

Production of battery systems are pictured at at VW’s factory in Brunswick, Germany. The automaker intends to make its own battery cells.

 

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