The Volkswagen Group and its battery company PowerCo have selected St. Thomas in Ontario, Canada to establish Volkswagen’s first overseas gigafactory for cell manufacturing. The plant will produce sustainable unified cells, with start of production planned for 2027.

The decision to expand the PowerCo cell production ramp-up from Europe to Canada is further evidence of the growth strategy of the Group in North America.

Our North American strategy is a key priority in our 10-point-plan that we’ve 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.

—Oliver Blume, CEO Volkswagen Group

After Salzgitter and Valencia, this will be the third 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 advanced 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.

While PowerCo is to become a key player in the development of the battery value stream in North America, Canada offers ideal conditions, including the local supply of raw materials and wide access to clean electricity. More details on gigafactory St. Thomas will be revealed in the near future.

The Volkswagen Group brands plan to introduce more than 25 new BEV models through 2030. In addition, the Group plans to fully leverage the North American region’s power by creating more synergies and making 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 said it 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.