VW raises EV investment in Spain by 10 billion euros

SAGUNTO, Spain (Reuters) – German carmaker Volkswagen AG and partners will invest € 10 billion ($ 10.6 billion) in Spain to build electric vehicles and batteries, its chief executive said on Thursday. This is 3 billion euros more than previously promised.

The company has also announced a partnership agreement with Spain’s largest power utility Ebardrolla, which will set up a solar park near Valencia to partially power a battery plant built in the municipality of Sagunto.

Iberradrola will invest 500 million euros in the electrification plan, its chief executive Ignacio Sanchez Galan told reporters without elaborating.

Volkswagen said in March it would invest 7 billion euros to build a battery plant and produce electric vehicles at its two car factories in Spain, but CEO Herbert Dice said that number had been raised to 10 billion with new partners on board.

“We will electrify the second largest car manufacturer in Europe (Spain) by producing a new giga-factory and electric cars at two plants,” Dice said at an event in Sagunto, adding to the plan “to build a full-fledged car”. Supplier ecosystem from lithium extraction to battery assembly “.

Dice spoke with Spanish Prime Minister Pedro Sanchez during a visit to the factory site.

Volkswagen aims to start construction of a 40-gigawatt-hour (GWh) plant in the first quarter of 2023, with serial production set to begin by 2026. By 2030, the site will employ more than 3,000 people, the company said.

Spain, Europe’s largest carmaker after Germany, last month launched a bidding process for a loan and grant of about 3 billion euros to promote the production of electric vehicles (EVs). Volkswagen and its Spanish unit SEAT have submitted a bid.

The winners of the PERTE Fund, as most of the European Union’s epidemic relief fund programs are known, will be selected this year.

The company will invest 3 billion euros in Sagunto’s plant, another 3 billion euros in four-seater factories, including a Martorel plant near Barcelona, ​​and 1 billion euros in Pamplona, ​​it said.

Volkswagen’s Spanish brand, Seat, does not currently sell an electric car (its Mii Electric City car has sold out).

(1 = 0.9463 euros)

(Reporting by Emma Pinedo; Additional report by Christoph Staitz; Editing by Bernadette Baum and Edmund Blair)

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