Volkswagen opens battery plant in Canada, Europe can wait

Volkswagen: Investment in a battery factory postponed, but will invest in EV

Volkswagen AG announced delays in its decision over the location of a planned gigafactory for electric car batteries in eastern Europe beyond 2022. The carmaker says it’s due to the current economic climate. But, anyway, Volkswagen plans a mega-investment in its Wolfsburg plant. There it will produce the electric ID.3 model.

According to emailed statements from Volkswagen AG, the company’s battery unit PowerCo is regularly assessing potential locations for its next gigafactory in Europe. There are still no decisions made. The evaluation process will continue.

The Czech subsidiary of Volkswagen had expectations

According to a previous report from the CTK news agency, the decision will be delayed by several months. The Czech Republic is one of the potential locations for the factory, which is expected to begin producing batteries in 2027. The other possible candidates along with the Czech Republic are Slovakia, Hungary, and Poland.

In October, Volkswagen’s Czech subsidiary Skoda Auto stated that it anticipated its parent company would decide on the site by the end of 2022.

There is no necessity to act immediately, according to Volkswagen. They will take more time to consider the options in light of the current situation. Therefore, due to the economic crisis, there is currently no effect on the anticipated start of manufacturing or building for Volkswagen.

For sure, Eastern Europe is a candidate for the fourth of Volkswagen’s planned six battery cell manufacturing facilities across Europe.

Volkswagen to invest in its Wolfsburg facility

But according to brand president Thomas Schaefer, Volkswagen will make a $482 million investment in its Wolfsburg facility by the beginning of 2025, with most of the money going toward making the electrified ID.3 model.

A second all-electrical SUV is expected to be produced in Wolfsburg on the MEB platform. It is an exclusively electrical chassis used since 2019. They planned the complete construction of the compact car for 2025.

The manufacturer added a new version of the electric drive kit, known as MEB+ is ready. Development of the construction and design of a new electric vehicle enables quicker charging times and larger ranges.

The top priority for the workers’ council has been to retool Wolfsburg’s production facilities. They employ 60,000 people and produce models like Golf, Tiguan, and Touran. The workers’ council wants to make electric vehicles here. They have concerns that the facility may become obsolete as the world moves toward electric transportation.

Pandemic “killed” carmakers

Since 2015, when it produced almost 800,000 vehicles, output at the flagship factory has been declining steadily, falling to just under 400,000 annually since the start of the coronavirus pandemic.

As suppliers cancel large orders with just one night’s notice, Schaefer claimed that the automaker was still dealing with “flat-out pandemonium” in the supply chain.

The automaker will choose by February whether to construct a new factory for the Trinity model nearby. The other option is to continue to produce the new Trinity electric sedan at the main Wolfsburg plant.

According to Schaefer, the new SUV type would expand upon the automaker’s current electric fleet.

This is the largest automotive market in the world, and our beloved Tiguan is a part of it. According to him, the new model would strengthen our market position and complement our best-selling ID.4 and ID.5 models.

The ID.3 manufacturing schedule is on track, with partial production beginning in 2023 and complete production anticipated in 2024.