Volkswagen and PowerCo to Build North American Battery Plant in Canada

The Volkswagen Group and its battery company PowerCo have chosen Canada for its first overseas battery cell plant.

The plant, located in St. Thomas, Ont., will produce battery cells starting in 2027, according to the German automaker. PowerCo, a VW company launched in July 2022, will manage the automaker’s global battery business, including raw material sourcing, cell production and manufacturing at the Canadian site.

The North American battery plant is part of the VW Group’s wider global plan to halve battery costs. The automaker plans to build six factories in Europe. Construction has started at sites in Salzgitter, Germany, and Valencia, Spain. The Canadian location will be the site of its third plant, and the first in North America.

Picture credits: VW Group

Volkswagen said the location is proof of its “ambitious growth strategy” in North America. The company highlighted other expansion plans in the region, including the launch of the US-focused Scout brand, which more than doubled the number of electric vehicle chargers in the US and Canada per year. through its subsidiary Electrify America and its software arm Cariad establishing offices in Seattle and Silicon Valley. .

Earlier this month, VW spin-out Scout announced plans to build its $2 billion plant in South Carolina. Scout was launched as a brand of rugged electric vehicles aimed at US consumers. The plant, located near Columbia, will be capable of producing 200,000 electric vehicles per year. Production is expected to begin in late 2026.

Volkswagen also said it had accelerated assembly of the ID.4 all-electric compact SUV in Chattanooga, Tennessee, and planned to upgrade its plants in Puebla and Silao, Mexico, for BEV assembly. The Mexican plant could also be used to produce BEV components such as electric motors in the second half of the decade, the company said.