Volkswagen’s subsidiary PowerCo will establish an electric vehicle (EV) battery manufacturing facility in St. Thomas, Ontario, Canada. The Volkswagen Group’s first overseas gigafactory for cell manufacturing will produce sustainable unified cells, and the start of production is planned for 2027.
The decision to expand the PowerCo cell production ramp-up from Europe to Canada is further proof of the ambitious growth strategy of the Group in North America.
From left: Oliver Blume, CEO Volkswagen Group; Thomas Schmall, Group Board Member Technology; Hon. François-Philippe Champagne, Canada’s Minister of Innovation, Science and Industry. (Photo: PowerCo)
“Our North American strategy is a key priority in our 10-point-plan that we’ve laid out last year. With the decisions for cell production in Canada and a Scout site in South Carolina we’re fast-forwarding the execution of our North American strategy,” said Oliver Blume, CEO Volkswagen Group.
PowerCo expansion is next step of ramping up global battery business while localizing cell production and setting up new value chain. Volkswagen Group is one of the world’s largest automakers, with $295.8 billion in revenue in 2022. It manages a portfolio of 10 companies.
“This historic investment is a testament to Canada’s strong and growing battery ecosystem and Ontario’s competitive business environment. With a highly skilled workforce, clean energy, an abundance of critical minerals, access to markets, and a flourishing automotive and battery sector, we are an attractive investment destination with everything companies need to grow. In addition, Canada and Ontario offer stability and predictability to their business partners,” said the Honorable François-Philippe Champagne, Canada’s Minister of Innovation, Science and Industry, and the Honorable Vic Fedeli, Ontario’s Minister of Economic Development, Job Creation and Trade, in a joint statement.
Canada’s auto sector supports nearly 500,000 workers, contributes over $11 million annually to Canada’s gross domestic product, and is one of the country’s largest export industries. Ontario’s auto supply chain comprises over 700 parts firms, over 500 tool, die, and mold makers, and over 300 connected and autonomous companies.
Canada and Ontario are top destinations for European investors, with recent investments in the battery supply chain by companies like Belgium’s Umicore, demonstrating the strong and growing potential for collaboration in the clean technology and automotive space.