By Isabelle Havasy

On March 13, Volkswagen announced the construction of a battery cell manufacturing plant in St. Thomas, Ontario. The first “gigafactory” of PowerCo, a subsidiary of the automaker dedicated to battery manufacturing, to be established on North American soil is expected to begin its operations in 2027.

The announcement follows the signing last August of a memorandum of understanding with Canada under which, in exchange for access to raw materials, Volkswagen agreed to build its plant on Canadian soil. This will allow PowerCo to take advantage of U.S. subsidies that require batteries for electric vehicles to be made from North American materials.

The announcement is an important vote of confidence in Canada and Ontario’s aspirations to be global leaders in the electric vehicle supply chain, according to statements by François-Philippe Champagne, federal Minister of Innovation, Science and Industry, and Vic Fideli, Ontario’s Minister of Economic Development, Job Creation and Trade, in a release issued by the Volkswagen Group.

The “gigafactory” is part of Volkswagen’s growth strategy in North America. The automaker, which wants to strengthen its presence overseas, plans to enhance its electric portfolio with the addition of more than 25 new models by 2030.

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