Volkswagen to build first overseas gigafactory in Canada

The Volkswagen Group is stepping up its activities in North America to strengthen its position in this important growth market for battery electric vehicles (BEV). 

The Group and its battery company PowerCo have selected St. Thomas in Ontario, Canada,  to establish Volkswagen’s first overseas gigafactory for cell manufacturing, which will produce  sustainable unified cells. Production is planned to start in 2027. The decision to expand the  PowerCo cell production ramp-up from Europe to Canada is further proof of the Volkswagen Group’s ambitious growth strategy in North America.  

This will be the third Volkswagen Group-owned plant worldwide and PowerCo’s first cell factory in North America. It will equip the Group  brand’s BEVs in the region with cutting-edge battery cells ‒ and is part of a larger plan that Volkswagen  and PowerCo agreed upon with Canadian Prime Minister Justin Trudeau’s government in August last  year. The Memorandum of Understanding signed back then focuses on battery value creation and raw  material security in order to promote e-mobility in the country. 

“Our  North American strategy is a key priority in our 10- point-plan that we laid out last year. With the  decisions for cell production in Canada and a Scout  site in South Carolina we’re fast-forwarding the  execution of our North American strategy,” said Oliver Blume, CEO of Volkswagen Group. 

“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. We  are committed to be a reliable partner and good neighbor for the people in St. Thomas and Ontario,“ said Thomas Schmall, board member for Technology  of Volkswagen AG and chairman of the  Supervisory Board of PowerCo SE.

“VW’s decision to establish its first overseas  gigafactory in Canada speaks to our country’s competitiveness when it comes to attracting major  investments. It is also a vote of confidence in Canada as the green supplier of choice to the world. With  Volkswagen and PowerCo, our government looks forward to working together towards a cleaner, more  sustainable and resilient economy,“ said Canada’s Minister of Innovation, Science and  Industry, François-Philippe Champagne.

Growth strategy for North America  

The Volkswagen Group is driving forward the introduction of the broadest portfolio of full-electric  vehicles in the United States. Group brands plan to introduce more than 25 new BEV models through  2030. In addition, the Group plans to fully leverage the region’s power by creating more synergies and  making even better use of the innovative strength, technical expertise, production capacities, supply  chains and market knowledge of all brands in Canada, the United States, and Mexico. 

Volkswagen will therefore continue to bring more manufacturing capabilities and know-how to the  region. In addition to its ramped-up assembly of the all-electric ID.4 compact SUV in Chattanooga,  Tennessee, Volkswagen also has plans to upgrade the plants in Puebla and Silao, Mexico, for the  assembly of BEVs and potentially for BEV components such as electric motors in the second half of the  decade.