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Volkswagen shares plans for North American battery plant

Volkswagen Group CEO Oliver Blume just lately shared that the corporate is actively trying to find a house for its first battery cell manufacturing unit in North America. Moreover, Blume has named Canada particularly as “one logical choice.” By becoming a member of Volkswagen’s present EV manufacturing footprint in Tennessee, the Group could quickly meet the battery manufacturing necessities outlined within the Inflation Discount Act for automobiles just like the ID.4 to proceed to qualify for US federal tax credit, whereas opening the door for extra EVs beneath its umbrella to qualify.

On the entire, Volkswagen Group is placing plenty of funding and energy into turning into an all-electric firm throughout most of its marques, together with Audi and Porsche. As an automotive model, Volkswagen particularly has assist lead the cost (no pun meant) for legacy automakers shifting their enterprise methods to help the rising wave of zero-emission automobiles.

Within the US specifically, VW has revamped a few of its manufacturing to help EV manufacturing in Chattanooga, Tennessee the place it’s now rolling out ID.4s. Moreover, Volkswagen Group has shared intentions for a second faciilty on US soil that would additionally embrace a battery cell plant.

Underneath present tax credit, the Volkswagen ID.4 qualifies for as much as $7,500 in federal tax credit, however these numbers might be reduce subsequent month when new phrases kick in as a part of the Inflation Discount Act signed by President Biden in August. Because the ID.4 is assembled within the US, it may nonetheless qualify for some degree of tax credit score, however both the battery elements and/or vital supplies should come from the US or a free commerce associate as effectively, a requirement Volkswagen is kind of conscious of.

A mere week after the President signed the IRA, Volkswagen introduced a provide settlement with the Canadian authorities to acquire uncooked supplies for battery manufacturing within the US. Now, it seems Volkswagen group is taking battery manufacturing a step additional by erecting its personal facility – its first on the continent.

Volkswagen battery recycling
Volkswagen’s present manufacturing facility in Chattanooga, Tennessee / Supply: Volkswagen Group

Volkswagen to bolster battery manufacturing in North America

Volkswagen Group CEO Oliver Blume reaffirmed the corporate’s intention to carry battery manufacturing the North America, significantly to help EV manufacturing within the US. Though the corporate continues to be looking, our neighbors to the north sound like a viable candidate:

Canada is one logical choice for the development of a gigafactory within the area of North America.

Blume went on to quote excessive requirements in sustainability and preferrred financial situations as elements that would quickly make Canada residence to Volkswagen’s first battery gigafactory outdoors of Europe. Conversely, the Group’s battery subsidiary PowerCo additionally introduced an prolonged take care of Umicore out of Belgium to ship cathode supplies to Canada. Volkswagen mentioned this settlement is a part of a long-term strategic partnership to help its full intentions of future battery cell manufacturing in North America.

Whereas many European automakers have scoffed on the revised tax credit score phrases within the Inflation Discount Act as unfair, the legislations intention to carry extra EV manufacturing to North America already seems to be working. By including battery manufacturing to the continent, extra Volkswagen Group’s automotive manufacturers could quickly qualify for tax credit.

Just lately reborn off-road nameplate Scout could possibly be a type of marques, particularly since it’s reportedly in talks with contract producer Foxconn to assist construct its EVs. Foxconn at the moment operates out of the famed Lordstown facility in Ohio. Add VW Group’s deliberate battery plant, and you could have a number of extra fashions out there to US clients that qualify for credit (pending MSRP in fact).

We’d count on the subsequent replace in Volkswagen Group’s search course of to incorporate the placement of the pending battery plant, and Canada seems to now be the frontrunner.

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