Volkswagen Group has released more details about its planned battery cell gigafactory in Canada, which will be the company's largest to date in the world and the country's largest manufacturing plant.
Set to be located in St. Thomas, Ontario and operated by the automaker's PowerCo SE battery subsidiary, the battery plant will have an annual production capacity of up to 90 GWh in the final expansion phase.
For comparison's sake, VW Group's battery gigafactory near Valencia, Spain, will have an annual output of 60 GWh when fully ramped, while the facility in Salzgitter, Germany will produce 40 GWh worth of battery cells each year.
The German automaker plans to invest up to $5.3 billion (4.8 billion euros) until 2030 in the Canadian facility that has the potential to create up to 3,000 highly skilled jobs at the factory and tens of thousands more indirect jobs in the region. The company will receive a lot more money from the Canadian federal government, though.
According to The Detroit News, Canada agreed to subsidies that may top $9.7 billion (13 billion Canadian dollars) over a decade, matching what VW would have got via the Inflation Reduction Act if it had located the plant in the US. The government will provide annual production subsidies as well as a grant toward the factory's capital cost.
Volkswagen revealed new details about its North American battery gigafactory on April 21 in the presence of several high-ranking Canadian federal government and Ontario province officials, including Prime Minister Justin Trudeau.
Rendering of Volkswagen Group's battery cell gigafactory in St Thomas, Ontario
Groundbreaking at the St. Thomas site is planned for 2024 and production is projected to begin in 2027. The factory is being built over an area of around 370 acres (150 hectares), the equivalent of more than 210 soccer or football fields. The entire industrial and supplier park amounts to 1,500 acres (600 hectares).
The site is located strategically about 18 miles (30 km) south of London, Ontario, at the heart of the Great Lakes Automotive Corridor and near major cities such as Toronto and Detroit.
As a result, PowerCo SE gets prime access to the regional research and innovation cluster, talented workforce, good transport infrastructure and established supply chains. The cell factory will be supplied with 100 percent CO2-free energy.
Volkswagen Group's first overseas gigafactory for cell manufacturing will supply its brands' BEVs in the North American region with unified cells, a whole new cell technology designed for volume production.
"North America plays a key role in our global battery strategy. The region will become PowerCo SE's second pillar beside Europe, with battery cells made in North America for North America. Gigafactory St. Thomas opens the door to a key market for e-mobility and battery cell production."
Thomas Schmall, Volkswagen Group Board Member for Technology
The battery cell gigafactory is part of Volkswagen Group's ambitious growth strategy in North America, which includes the introduction of the broadest portfolio of full-electric vehicles in the United States and Canada by 2030, the expansion of Electrify America's coast-to-coast charging network in the US and Canada, and the revival of the iconic Scout brand as a maker of all-electric vehicles from 2026.
Prime Minister of Canada Justin Trudeau speaking at Volkswagen Group's battery cell factory announcement