VW, Gotion ramp up battery production in Europe, Morocco amid rising EV demand
Volkswagen Group and its Chinese partner Gotion High-tech have stepped up a gear in tapping global demand for electric vehicle (EV) batteries with plans to invest a combined €3.22 billion (US$3.66 billion) to set up three production lines in Europe and North Africa. The factories, to be jointly owned by the German marque and China’s fourth-largest EV battery maker, would be capable of delivering…
Volkswagen Group and Chinese battery manufacturer Gotion High-tech are ramping up their production capacity to meet the growing demand for electric vehicle (EV) batteries. The two companies plan to invest a combined €3.22 billion in setting up three production lines in Europe and North Africa. These factories will have a combined capacity of 37.5 gigawatt hours (GWh) of lithium-ion battery capacity and 100,000 metric tons of cathode materials annually, according to Gotion's exchange filing.
The three manufacturing facilities are to be built in Spain, Slovakia, and Morocco, with Gotion investing about €1.6 billion and Volkswagen committing a similar amount. The largest project, an EV plant in Valencia, Spain, will be operated by Volkswagen subsidiary PowerCo and is expected to deliver 29.1 GWh of battery capacity annually.
According to Chen Jinzhu, CEO of Shanghai Mingliang Auto Service consultancy, Chinese-developed EV batteries are in high demand outside mainland China. Gotion's strategic partnership with Volkswagen will allow the company to easily access the European market as it accelerates its global expansion plans. Gotion is currently 24.3% owned by Volkswagen.
In the first seven months of 2026, Gotion delivered 34 GWh of battery capacity to EV assemblers, a 44.2% increase from the previous year. The company's global market share stood at 4.7% during this period, up from 3.9% in the same period last year. Gotion, along with its three largest domestic rivals - Contemporary Amperex Technology Ltd (CATL), BYD, and CALB - collectively hold a 64.4% share of the global EV battery market.
China's manufacturing advantage has provided its battery makers with a cost edge, with average prices falling to US$84 per kilowatt hour (KWh) in 2025, according to a BloombergNEF survey. Earlier this week, CATL secured regulatory approvals for its €7.3 billion mega factory in Hungary, which will produce 100 GWh of batteries per year. Volkswagen also plans to reduce its Gotion stake to 19% by selling 96 million shares to an investment firm controlled by the Hefei government.
Written by urgent.news from SCMP Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
