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VW invests big in German-made batteries for electric cars

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Volkswagen is looking to make a billion euro investment in a new Gigafactory to make batteries for electric cars. In addition to new factories, VW also wants to develop new batteries that do without the scarce cobalt.

Since the worldwide production of batteries is not sufficient, car manufacturers now have to take action themselves. Volkswagen has now announced its new strategy to cover its own needs for lithium-ion batteries. After all, VW intends to sell 70 purely electric models with a total volume of 22 million units over the next ten years.

Fortunately, the manufacturer is now offering a billion euros for the construction of its own so-called Gigafactories, one of them in the German region of Lower Saxony. The catch: Volkswagen does not want to pay the EEG levy. The group would still have to negotiate a corresponding deal with the Federal Office of Economics and Export Control, which supervises the levy.

Initially, VW will be able to cover its battery requirements with purchases from SKI, LG Chem and CATL. But in the long term, the company has to produce batteries itself. At the possible Gigfactory location in Salzgitter, development, procurement and quality assurance of the battery cells are to be started at short notice. And already in the "second half of 2019 [...] a pilot production will start", says the strategy paper.

In addition to Salzgitter, other locations in Europe will also receive VW Group Giga Factories. In addition to manufacturing, VW also wants to take care of disposal and recycling. The VW subsidiary Audi had already made an effort about the latter.

And the delicate issue of scarcity of resources is also addressed. Volkswagen wants to have secured at least lithium from China for the next ten years. VW, on the other hand, wants to reduce its dependence on significantly scarcer cobalt through research. For example, VW batteries are expected to have a cobalt content of only five instead of 14 percent over the next three to five years. Research into cobalt-free alternatives is also being carried out in parallel.

VW may want to sell MAN

In the same press release, VW makes a casual remark that it might want to sell the diesel engine manufacturer MAN Energy Solutions. At the same time, the Traton Group, which also specializes in large commercial vehicles, is to be floated on the stock exchange.

The Supervisory Board has also instructed the Executive Board to start the process to develop a forward-looking, industrially viable solution for MAN Energy Solutions (ES) and Renk. The focus here is on opening up future and growth prospects for mechanical engineering in the Group, for example through a joint venture, partnerships or a partial or complete sale.

In addition, it was decided to prepare an IPO of TRATON SE and, subject to further capital market developments, to carry it out before the 2019 summer break.

VW is therefore going through several developments at once. For many employees, this will mean that they will also have to retrain. It remains to be hoped that they will be able to withstand the pressure of change in the industry.

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Eric Ferrari-Herrmann

Eric Ferrari-Herrmann
Senior Editor

Eric has been with AndroidPIT since 2014. He’s writing articles and reviews for the German website. Topics are mostly privacy and new technology but there's also the occasional piece on environmental sustainability.

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