A joint venture between Volkswagen Group and the Swedish battery producer Northvolt AB is gaining further momentum, with Volkswagen to erect buildings and infrastructure for the Northvolt Zwei factory that will produce lithium-ion battery cells.
Around 450 million euros is to be invested in the project and battery cell production is scheduled to commence in early 2024 with an initial production capacity of 16 GWh. Volkswagen and Northvolt established the joint venture in September 2019 to prepare for the large-scale production of lithium-ion batteries in Germany. Construction work at the site is scheduled to commence before the end of this year.
“We are optimising the Volkswagen Group’s strategic position in the key future field of batteries” said Dr. Stefan Sommer, Volkswagen Group Board Member for Components and Procurement and a member of the Northvolt AB Board of Directors. “In addition to a very secure supply base with external producers, we are also systematically building up further capacities.”
Thomas Schmall, CEO of Volkswagen Group Components, added that battery cell production in Salzgitter is an important step for the transformation to e-mobility and that the JV is pooling expertise at the Salzgitter site with production capabilities and the Center of Excellence for Battery Cells in order to drive battery cell development further forward, developing new standards and transferring them direct to the manufacturing process.
The Volkswagen Group is amassing technological expertise in the field of battery cell production as part of its electrification strategy. In addition, the Group maintains strategic relations with several producers to secure its battery supplies in all world regions. Currently, these suppliers are LG Chem, Samsung and SKI for Europe as well as CATL for China and Europe. In addition, SKI will also supply battery cells for the US market. In Europe alone, Volkswagen expects annual demand of over 150 gigawatt hours from 2025, with demand in Asia at a similar level.