Volkswagen and PowerCo SE will build their largest cell factory in Canada.
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Volkswagen and PowerCo SE will build their largest cell factory in Canada.

Volkswagen Group will invest CAD7 billion to build its largest cell gigafactory in St. Thomas, Ontario, with an annual production capacity of up to 90 GWh.

Volkswagen Group has announced its plans to build its largest cell gigafactory to date in St. Thomas, Ontario, Canada. The battery company, PowerCo SE, will undertake the massive project, which is aimed at supporting the Group’s ambitious electric vehicle strategy in North America.

The new gigafactory will have an annual production capacity of up to 90 GWh in its final expansion phase, making it a significant player in the battery production industry. With a planned investment of up to €4.8 billion / CAD$7 billion until 2030, the factory has the potential to create up to 3,000 highly skilled jobs and tens of thousands of indirect jobs in the region, giving a much-needed boost to the Canadian economy.

The announcement was made in the presence of Canada’s Prime Minister, Justin Trudeau, the Minister of Innovation, Science and Industry, François‑Philippe Champagne, Ontario’s Premier, Doug Ford, Ontario’s Minister of Economic Development, Job Creation and Trade, Victor Fedeli, and Joe Preston, Mayor of the City of St. Thomas. The presence of such high-ranking officials at the event underscores the importance of the project and its potential impact on the region.

Groundbreaking for the factory is planned for 2024, with production projected to begin in 2027. The factory will equip the Group brands’ BEVs in the North American region with cutting-edge unified cells, which are a whole new cell technology designed for volume production.

This gigafactory is part of a larger plan that Volkswagen and PowerCo agreed upon with the Canadian government in August of last year. The Memorandum of Understanding signed at the time focused on battery value creation and raw material security to promote e-mobility in the country, highlighting the importance of collaboration between industry and government in the transition towards sustainable transportation.

The new cell factory is set to cover an impressive 370 acres (150 hectares) of land, equivalent to more than 210 soccer or football fields. It forms part of a larger industrial and supplier park spanning 1,500 acres (600 hectares). The strategic location of the facility, situated about 30 km south of London, Ontario, places it at the heart of the Great Lakes Automotive Corridor, with close proximity to major cities such as Toronto and Detroit. This location provides PowerCo with excellent access to the regional research and innovation cluster, a highly skilled workforce, robust transport infrastructure, and established supply chains. Additionally, the cell factory will be powered by 100% CO2-free energy, emphasizing the Volkswagen Group’s commitment to sustainability.

Battery technology is a key element of the Volkswagen Group’s 10 Point Plan, aimed at accelerating the company’s transformation towards sustainable transportation. To this end, the Group established PowerCo SE in Germany as a separate battery company, consolidating its global battery business across the entire value chain - from raw material supply and development to the construction and operation of gigafactories. Since its launch in July 2022, PowerCo SE has identified the locations of three cell factories in Salzgitter, Valencia, and St. Thomas in North America. By 2030, the company and its partners are projected to generate annual revenue exceeding 20 billion euros.

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