Volkswagen Group announced today that it will be constructing its first North American EV battery factory in St. Thomas, Ontario, which lies between Toronto and Windsor.
The company and its in-house battery subsidiary PowerCo did not disclose financial information, but it did say the plant will be operational by 2027. It will be PowerCo’s first battery plant outside of Europe, after Salzgitter, Germany, and Valencia, Spain. The St. Thomas facility will supply VW Group electric vehicles made in North America.
Part of the reason for choosing St. Thomas is that Canada offers ideal conditions for battery development, such as a local supply of raw materials, access to clean electricity and proximity to the Windsor-Detroit auto corridor. Last year, VW signed a memorandum of understanding with the Canadian government that focused on battery value creation and raw material security in order to promote electric vehicles in the country.
St. Thomas is part the Group’s larger electrified plans for North America, which also include more than 25 new models through 2030, such as the upcoming Scout brand that will be built in South Carolina. VW has also increased production of the ID.4 built in Chattanooga, Tennessee, and it plans to upgrade plants in Puebla and Silao, Mexico, for EV assembly.
Thomas Schmall, Board Member for Technology of Volkswagen AG and Chairman of the Supervisory Board of PowerCo SE, said in a statement that the announcement “sends a strong message:
“PowerCo is on track to become a global battery player. With the expansion to North America, we will enter a key market for e-mobility and battery cell production, driving forward our global battery strategy at full speed.
“Canada and Ontario are perfect partners for scaling up our battery business and green economy jobs, as we share the same values of sustainability, responsibility and cooperation,” he continued. “We are committed to be a reliable partner and good neighbour for the people in St. Thomas and Ontario.”