Volkswagen-Bosch Establish Joint Venture for Battery Production Facilities

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Kwon Jae-hee] German automaker Volkswagen and the world's largest automotive parts company Bosch are establishing a joint venture to supply electric vehicle battery production facilities.

According to major foreign media on the 18th (local time), Volkswagen and Bosch plan to establish a joint venture within the year to supply battery production systems to battery manufacturers in Europe. They will also support expanding production capacity and maintenance of existing battery factories.

Thomas Schmall, Volkswagen's head of battery division, stated, "Europe has a once-in-a-lifetime opportunity to become a global battery production hub in the coming years," adding, "We will build a complete and localized European supply chain for Made in Europe electric vehicles."

However, the two companies did not disclose specific details such as the scale of investment.

According to the European Battery Alliance (EBA), the planned battery production capacity in Europe based on announced factory construction plans is estimated to be 900 gigawatt-hours (GWh).

The EBA, established by the European Union (EU) Commission in 2017 to build a battery self-sufficiency ecosystem, originally planned to increase Europe's share of global battery production to 16% by 2029.

However, to reduce dependence on South Korea and China, which currently dominate the battery market, the EBA recently stated that about one-third of global battery production should be produced within Europe by 2030.

The largest planned battery factory in Europe to date is a factory to be built near Tesla's "Gigafactory" in Germany, which will have a battery production capacity of over 100 GWh.

Volkswagen has set a goal to build six gigafactories in Europe by 2030, achieving a total battery production capacity of 240 GWh. Additionally, Volkswagen announced in December last year that it would expand its investment for the transition to electric vehicles to $52 billion (approximately 62 trillion KRW) over the next five years.

Bosch had been negative about independent battery production due to reasons such as excessive investment costs, but major foreign media reported that Bosch is expected to strengthen its role in the transition to electric vehicles going forward.

This content was produced with the assistance of AI translation services.