VW to manufacture batteries for electric vehicles with Chinese Guoxuan in Germany
FRANKFURT – Volkswagen will manufacture batteries for electric vehicles in Germany with a leading Chinese manufacturer, from 2025.
The German automotive group will build its second electric vehicle battery plant in Salzgitter as part of a joint effort with Guoxuan High-tech to produce low-cost batteries for fuel-efficient electric vehicles, the company said in a statement last Tuesday. .
In May 2020, VW announced the acquisition of a 26% stake in Guoxuan, China’s third-largest manufacturer of electric vehicle batteries after Contemporary Amperex Technology and BYD.
VW initially wanted to produce batteries with Northvolt, a Swedish battery maker 20% owned by VW, at the Salzgitter plant, but changed plans, with the Swedish maker now focusing on batteries for high-end electric vehicles. .
The German automaker also said it was in final phase negotiations with the Spanish government on new production plans in Spain. These include projects for Volkswagen’s third electric vehicle battery plant with an annual capacity of 40 gigawatt hours – enough to power around 500,000 to 800,000 electric vehicles – as well as a manufacturing plant to produce small electric vehicles in Spain from 2025.
VW announced in March its intention to set up six electric vehicle battery factories in Europe by 2030, with the aim of mass-producing standardized batteries to reduce costs and increase vehicle profitability. The company predicts that electric vehicles will account for 50% of its new car sales by 2030 and nearly 100% by 2040.
The automaker believes that the profit margin of electric vehicles will be similar to that of internal combustion engine (ICE) cars within a few years due to increased manufacturing of electric vehicles.
VW will scale back its ICE models to maintain profitability, targeting an 8-9% profit-to-sales ratio in 2025, up from 7-8% in its original plan.
Electric vehicles will become inexpensive with advances in battery technology and the expansion of the production scale, CEO Herbert Diess told reporters.
VW is standardizing the architecture and software of all brands, including Audi and Porsche, which will affect 10 million vehicles per year from 2026.