Volkswagen has selected a location in Canada for its first new EV battery factory PowerCo . business unit outside Europe.
Thomas, Ontario, the plant is expected to begin battery production in 2027, according to a VW press release. This will be the third PowerCo battery plant globally, along with plants in Salzgitter, Germany and Valencia, Spain.
Volkswagen ID.4 built in Chattanooga
As VW announced last summer, PowerCo will establish and oversee a global network of battery factories to vertically integrate the supply chain for electric vehicles.
VW has been is said to be considering Canada for months, after the Inflation Reduction Act (IRA) and North American sourcing requirements for their new Clean Vehicle Credit allowed an incentive for electric vehicles and core components to be built in Canada or Mexico as if they were built in the U.S. PowerCo’s facilities are due to the creation of a new EV-driven umbrella format built on the next-generation Scalable System Platform (SSP) of the VW Group.
Trailer for Scout Motors electric SUVs and pickups
The IRA’s incentive rules are also likely to influence decisions to ramp up electric vehicle assembly in North America. VW already build ID.4 in ChattanoogaTennessee, but also plans to upgrade plants in Puebla and Silao, Mexico, to assemble electric vehicles and potential components like engines, in the second half of this decade.
VW also recently announced a factory in South Carolina for its Scout brand, which is unrelated to the VW brand in the US but will likely exploit the same battery source. Located near the state capital of Columbia, the Scout plant is slated to begin vehicle production in 2026, with an annual production capacity of 200,000 vehicles at maximum volume. The first Scout model will be a Electric SUV 40,000 USD, followed by a slightly more expensive electric pickup. Both models will be launched in 2024.
