Volkswagen and Gotion form joint ventures for battery plants in Spain, Slovakia and Morocco

Cross-border joint ventures and equity adjustments

Volkswagen and Chinese battery producer Gotion High-Tech finalized agreements on 28 September 2026 to restructure their manufacturing alliance across Europe and North Africa. Under the terms of the transaction, Gotion will pay approximately 1.1 billion euros to acquire a 49% stake in PowerCo's gigafactory currently under construction in Sagunto, near Valencia. PowerCo, the battery manufacturing subsidiary established by Volkswagen in 2022, will retain a 51% controlling interest to ensure continuity in governance, strategic direction, and operational management. In parallel, Volkswagen agreed to sell a 5.3% equity stake in Gotion while preserving a significant minority holding in the Hefei-based manufacturer. The partnership builds on ties established in 2020, when Volkswagen first acquired an equity stake of roughly 25% in Gotion.

Production allocations across three industrial facilities

The corporate agreement establishes three joint operations across Spain, Slovakia, and Morocco to construct an integrated regional supply chain for electric vehicle components. PowerCo plans to invest roughly 470 million euros by 2030 across Gotion's international sites, deploying 235 million euros to secure a 49% stake in an operational cell factory in Šurany, Slovakia, and another 235 million euros for a 49% holding in a precursor materials plant in Kenitra, Morocco. In Spain, Gotion is actively installing cleanrooms at the Parc Sagunt site, where production of lithium iron phosphate (LFP) cells is scheduled to begin in July 2027. The Sagunto project represents an ongoing capital commitment exceeding 2.3 billion euros, designed for an annual capacity of 30 GWh across two initial production blocks and supporting more than 1,500 direct jobs.

Volkswagen is the first European carmaker to cover the entire battery value chain - from development through raw materials to production.

Shifting battery chemistry and market demand

The joint venture focuses heavily on scaling lithium iron phosphate chemistry, which currently accounts for over half of global electric vehicle cell demand according to International Energy Agency data. Market forecasts cited by company representatives project that LFP technology will account for between 40% and 65% of total European battery cell demand by 2030 due to cost efficiency, safety, and durability in high-volume vehicle segments. Virtually all LFP cells utilized in European assembly lines are currently imported from Chinese manufacturing facilities. By localizing cell production in Sagunto and component sourcing in Morocco and Slovakia, Volkswagen aims to lower supply chain exposure and meet volume targets across European compact electric vehicle ranges.

PowerCo operational network and regional timeline

The Spanish expansion integrates into PowerCo's broader manufacturing rollout, which began commercial cell output at its Salzgitter plant in Germany on 17 December 2025. Salzgitter produces unified prismatic nickel manganese cobalt cells with an initial annual capacity of up to 20 GWh, expandable to 40 GWh to supply approximately 250,000 vehicles annually. Cells from Salzgitter are shipped to SEAT's Martorell facility and Mobis in Pamplona to equip the ID Polo, ID Cross, Skoda Epiq, and Cupra Raval models, which have accumulated roughly 100,000 customer orders. While European production advances, PowerCo delayed the commissioning of its planned battery plant in Ontario, Canada, to 2029 due to trade tariffs and slower market demand in North America.