Volkswagen and Bosch signed a Memorandum of Understanding to explore a joint venture to provide Europe with battery equipment solutions. Volkswagen said that the two companies aim to supply integrated battery production systems and on-site ramp-up and maintenance support for battery cell and system manufacturers.
VW will be able to serve other factories across Europe thanks to the JV, which is expected to help the company reach its goal of building six cell factories. The companies didn't say how much they would invest.
As they set ambitious targets to deliver millions of electric vehicles in the next few years, they are working on becoming more self-sufficient and less reliant on getting their battery supplies from abroad, which has become even more problematic with the Pandemic-related supply chain issues. VW was the first to build a battery cell production facility in Germany, with a JV with Northvolt, and it was the first to build a battery cell production facility close to home.
Thomas Schmall, a VW board member responsible for the automaker's battery plans, said that Europe has the chance to become a global battery powerhouse. The equipment of new gigafactories is in high demand because of the strong demand for all aspects of battery production. Volkswagen and Bosch will explore opportunities to develop and shape this industry.
Volkswagen is following in the footsteps of other automakers and offering services to competitors. Ford and ADT formed a joint venture to provide a vehicle monitoring system that can be attached to any car to help prevent thefts.
The decision to engage in the vertical integration of the battery-making value chain will tap new profit pools. Setting out to establish a fully European supply chain for e-mobility made in Europe is a rare opportunity in business history.
The European battery alliance wants to cut dependence on South Korean and Chinese batteries by the end of the decade, but so far battery cell plants capable of generating under 900 gigawatt hours of capacity in Europe are set to make up the rest.
The plant and factory are still awaiting approval from regional authorities to begin production, despite CEO Musk's earlier promises that production would begin in
If Volkswagen succeeds in ramping up production and building a total of six factories, it should have a combined output of over 200 giga.
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