VW Planning Its Own Battery Gigafactory With Help From SK Innovation

OCT 27 2018 BY MARK KANE 24

Volkswagen will clone the Tesla-Panasonic gigafactory approach?

Volkswagen so far was relying on external supplies of lithium-ion battery cells and besides some investment in research of next-generation batteries, it doesn’t have any in-house factory.

The example of the successful and profitable partnership between Tesla and Panasonic in the Tesla Gigafactory project, as well as the scale of further Volkswagen EV plans, encourages it to consider its own battery gigafactory and contracted with a battery manufacturer.

Volkswagen said that it needs up to 150 GWh annually by 2025 for some €50 billion ($60 billion) and so far contracts awarded to suppliers have a volume of some €40 billion ($47.7 billion).

According to Germany’s Manager Magazin, Volkswagen is in negotiations with SK Innovation to build a battery gigafactory in Europe.

It would be an interesting match, as SK Innovation is a much smaller player than other South Korean manufacturers (LG Chem or Samsung SDI), Japanese (Panasonic) or Chinese (CATL, BYD) and such a partnership would open the way to growth.

Currently, SK Innovation is in progress to build a 7.5 GWh plant in Hungary.

Source: Manager Magazin via Electrek

Categories: Volkswagen

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24 Comments on "VW Planning Its Own Battery Gigafactory With Help From SK Innovation"

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ffbj

But it will just as big as Tesla’s and cost half as much.

G2

Good echo of the VW propaganda.
Seriously though; I hope the recent spate of VW announcements is their “come to Jebus” moment and they start to use their clout for good and not evil.

noleaf4me

Took them long enough to copy the leader (or at least say they will…..(VW = Vapor Ware…)

scott

Sounds like a losing combination. If VW were serious they would partner with LG or Panasonic.

MoMac

So how much time have you spent testing SK cells?

Being a smaller supplier doesn’t necessarily mean their product is worse.

Franco

Front wheel drive?

John Doe

No, they will offer rear wheel drive and AWD.

Johnny Cassell

Ahahahahahahahaha Hey Volkswagen how about you make an ignition coil, wiring harness, or a window regulator that isn’t a complete mistake before you dabble in planting customers atop your own custom made battery bombs. Anyone who would ever buy an electric Volkswagen has no understanding of their consistent track record of electrical Gremlins. Just stick to making 35 times the federal regulation Diesel profit eaters you garbage car manufacturer.

MoMac

Volkswagen is in the middle of the pack in repair trips per 100 cars per year.
See link.

Don’t look at the bottom though.

https://www.truedelta.com/car-reliability-by-brand?min=2017&max=2018

yo

And it roughly mirrors Consumer Reports…

CDAVIS

That announcement basically confirms VW is a minimum 4 years behind Tesla on being able to compete against where Tesla is *today* in high volume EV production… but Tesla is not remaining static… VW is chasing a fast moving target.

In two years there will be no VW EV that can compete against a Tesla. That is because the current VW Executive Management are not capable of repositioning VW to compete against a Tesla… period.

Modern EV represents a different business model proposition than legacy ICE… there is little desire at VW for VW to convert a significant portion of existing VW ICE customers to EV… in fact VW is actively steering away from that outcome.

Likely this will result in a significant restructuring of VW Group *after* VW enters full EV crisis mode which will be within next 2-3 years. Then it will take VW Group another 3-5 years to fully reorganize and reposition to compete against a Tesla. So it may take 5-8 years for VW Group to be in a position to compete against a Tesla.

Brandon

Is VW really aiming to compete with Tesla in the realm of low end luxury EVs?
It sounds to me more like VW is aiming for production of reasonably affordable EVs for the the majority market. In that respect, it’s not certain if Tesla is aiming that direction, and if they were to do so in 2-3 years, then they would be at the same place as VW with their I.D. lineup in 2-3 years.
The time for a $25-30k EVs is not here yet, but in about two years it will be, because of battery prices and other factors like charging infrastructure that would not allow a $28k 250 mile 100+kW fast charging EV to be possible for the masses.

MoMac

“there is little desire at VW for VW to convert a significant portion of existing VW ICE customers to EV”

It is not so much of a conversion of existing ICE vehicle models to EVs — although that will likely be true in some cases — but rather developing new EV models. Obviously, if sales of a given ICE vehicle model falls below a certain threshold, VW will end production of that model.

Pushmi-Pullyu

Let’s hope there is something real behind this rumor. Recently I had hopes that VW’s announcements about investing in EV battery supply and putting multiple models of EVs into production were actually real plans, and not just more of VW’s habit of churning out EV vaporware… but the most recent press releases from VW are very contradictory, indicating that either it’s just more vaporware or else VW itself hasn’t decided what to do about transitioning to EVs.

I’ve been predicting for years that other auto makers would follow Tesla in building their own high-capacity battery cell factories. It would be gratifying to point to this as vindication of my predictions, but unfortunately when it comes to VW, we can’t believe anything they say about EVs (or EV batteries) until we see some solid evidence that they are actually in the process of building something.

MoMac

So what exactly are the contradiction(s) to which you are referring?

I am not necessarily disagreeing with you. It’s just that when you claim “press releases from VW are very contradictory”, that statement should be followed up by what you believe is contradictory.

wavelet

Originally, VW’s published strategy was standardized battery module (both form factor and electrical specs), and rather than build modules themselves, would have battery vendors bid on supplying the modules; this was supposed to be better than owning their own factory, and a car could have modules from multiple vendors.
This contradicts the current talk about their own battery plant. It’s not necessarily that the original strategy is wrong , but the annoying thing with VW is they’re talking the talk (the immense number of concept vehicles, including vaporware concepts; the recent claim about half price of a Tesla), long before they’re walking any kind of walk.
Fact on the ground, they’ve been selling very few BEVs.

MoMac

I believe they still have contracts with cell suppliers.

The in-house cell manufacturing is in addition to the contracts that they already have according to Electrek’s article on 25 October.

yo

Building their own factory has nothing to do with standardized battery modules (both form factor and electrical specs)…

Having battery vendors bid on supplying the modules; this was supposed to be better than owning their own factory… And VW probably still believes this is true but you have to do what you have to do to get an adequate battery supply for their plans whatever they may be…

Furthermore we don’t even know what VWs plans are with this factory??
Does VW think SK has superior batteries that are expensive they will use for special applications??
Does VW think Sk has cheap batteries that are simply adequate and this allows them to make their own plant??
Or are we just throwing Stuff on the wall to slander a company that is popular to hate??

And yes VW does not sell very many BEVs in the US and in fact VW does not sell very many vehicles at all in the US…

Pushmi-Pullyu

“Or are we just throwing Stuff on the wall to slander a company that is popular to hate??”

No, we’re not.

You’re correct to say “Building their own factory has nothing to do with standardized battery modules”, or at least the one certainly doesn’t contradict the other. That’s not at all what I was complaining about.

Does VW really plan to build 1 million EVs by 2025? Or is it just going to try to lobby the German government to roll back the zero emission mandate so they can keep making dirty diesel and dirty gasoline-powered cars? My guess is they’ll do a full-court press on the latter while making only a half-hearted (or quarter-hearted) effort at the former.

Pushmi-Pullyu

I thank Wavelet for responding, but actually he’s on a different track than what I intended.

What I was trying to say is pretty well summed up in a recent IEVs article:

It seems each day the Volkswagen story changes. The automaker has been advertising its dive into electric vehicles for years and still has little to show for it. The Dieselgate scandal shed additional light on the automaker’s efforts, as well as the speed at which it was going to push forth with its huge EV offensive. One announcement after another, yet not much has come to fruition. Not to mention plan changes, delays, and sporadic negativity toward electric vehicles.

See full article, with lots of links to the contradictory statements from VW:

“VW CEO Warns Against Possible Auto Industry Crash Due To EVs”

https://insideevs.com/vw-ceo-evs-crash-auto-industry/

In particular, see the link for VW’s announcement of “its huge EV offensive”, which in light of more recent announcements from VW, seems rather questionable:

“Volkswagen Plans Massive Electric Car Offensive: 1 Million EVs By 2025”

https://insideevs.com/vw-electric-car-1-million-2025/

Does VW stand for VolksWagen… or for VaporWare? (◣_◢)

YVES LAURIN

peoples are rather pessimistic regarding VW, but maybe they have no choice but to change fast; after the diesel gate. It may become a survival issue (maybe not for VW itself but for the upper management. Whe you get push against the wall you become a lot more creative (that is why there where a lot of inventions during the 2 world wars)

Jason

VW are planning on building this factory. How long does it take to bring this sort of factory online? And how long to get to full production? If Tesla G1 is any indication, then it can take several years.
So I’d read it that VW will be battery constrained in the first instance (out sourcing) and gradually improve if/when this factory comes online.

haha yeah

If you people have done some research, you should understand that SK is not a minor company. SK is 6th largest conglomerate in South Korea, and has seriously strong background in Energy department. It is focusing on battery now, and it will become a heavyweight fighter in EV battery business sooner than later. Also, SK is a supplier for Daimler, so yeah, its performance seems proven to me. I think it will be a strong alliance.

haha yeah

SK- 3rd largest conglomerate in South Korea, not 6th.