Volkswagen Group and Canada aim to advance sustainable battery supply chain in North America
24 August 2022
Volkswagen Group (Volkswagen AG) and the Government of Canada signed a Memorandum of Understanding (MoU) to promote e-mobility in the country and to explore opportunities across Canada’s automotive and battery supply chain. Both parties will investigate opportunities for Canada to contribute to Volkswagen’s global and regional battery supply chains.
PowerCo, the newly founded battery company of the Group, has a central role in these efforts and will drive forward the planned cooperation in the fields of battery value creation, raw materials supply chains and cathode material production in the North American region.
PowerCo SE is responsible for all global Group activities along the battery value chain, securing battery cell supply for Volkswagen’s e-mobility push. The rapidly growing global battery cell business is a key pillar of Volkswagen’s NEW AUTO strategy, which aims to make Volkswagen the leading provider of more sustainable and software-driven mobility.
The plan is to build up quickly highly standardized cell production capacities totaling 240 gigawatt hours per year in Europe alone. In addition, there are plans to establish a dedicated Gigafactory in North America. Possible production sites are currently being examined.
Canada is quickly becoming the green supplier of choice for major auto companies, including leading European manufacturers, as we transition to a cleaner, greener future. By partnering with Volkswagen, Canada is strengthening its leadership role as a world class automotive innovation ecosystem for clean transportation solutions. Canada is committed to building a strong and reliable automotive and battery supply chain here in North America to help the world meet global climate goals.—François-Philippe Champagne, Canada’s Minister of Innovation, Science and Industry
For the development of more sustainable battery production, both parties intend to boost cooperation based on recognized ESG (Environment, Social, Governance) criteria between PowerCo and the Canadian mining sector. For this purpose PowerCo is planning to establish a new, dedicated liaison office in Canada. A key focus of cooperation is the supply of critical raw materials such as lithium, nickel and cobalt.
Both parties see significant prospects for Volkswagen and PowerCo to ramp up cathode material production together with partners and to offer Canadian suppliers an opportunity to act as raw material suppliers, refiners and processors.
With its vast raw material resources, good infrastructure and highly developed automotive industry with considerable production expertise and highly qualified workforce, Canada sees itself outstandingly well-positioned for joint projects.
The Volkswagen Group brands plan to offer the most comprehensive electric product portfolio in North America with more than 25 battery-electric models by the end of the decade; at the same time, strong regional capabilities for EV research and development, vehicle assembly, component production and supply relationships are being expanded across the North American continent.