Volkswagen: €480 million investment in Quneitra battery plant

The German Volkswagen Group, through its battery arm PowerCo, entered the industrial investment line in Morocco, after announcing a partnership with the Chinese group Gution Hi-Tech to establish a new production unit in the city of Quneitra, dedicated to the manufacture of cathode materials for electric vehicle batteries, with an investment of about 480 million euros. According to the agreement between the two parties, Gution will acquire 51% of the capital of the new joint venture company, while PowerCo retains a 49% stake, provided that The unit has an annual production capacity of 100,000 tons of cathode material for LFP batteries, a technology that Volkswagen is increasingly adopting in its new electric vehicles. Part of a broader global investment, the Quneitra project is part of a wider €3.22 billion investment announced by Gution Hi-Tech in conjunction with its new partnership with Volkswagen, which includes the creation of three production units distributed among Morocco, Spain and Slovakia: Comparison of the three production units For the Gaution and Volkswagen project Location Type of production Value of investment Annual production capacity Kenitra (Morocco) Cathode materials 480 million euros 100 thousand tons Valencia (Spain) Battery cells 2.26 billion euros 29.1 GWh Shorani (Slovakia) Battery cells 480 million euros 8.4 GWh The majority of the production of the Kenitra plant of cathode materials will be directed towards supplying the battery cell manufacturers of the two groups in Valencia and Shorani, within an integrated supply chain linking Morocco directly to the factories Volkswagen Electric Cars in Europe. This investment comes in addition to the giant project that Gution is carrying out alone in Quneitra , estimated at about $5.6 billion, which the Chinese group set next October as the date for its entry into production, to become the first giant battery factory in Africa. What this means for Morocco This new investment strengthens Morocco's position as a regional station for the production of electric battery components, at a time when several countries are racing to attract investments in this sector strategy linked to the future of the automotive industry. The project is also expected to provide new job opportunities in the Quneitra region, which in recent years has turned into an industrial pole for assembling cars and producing their components, thanks to its proximity to European ports and low production costs compared to other competitors. The new project falls within a broader path through which Morocco seeks to build an integrated system around the battery industry, after OCP Group in turn inaugurated the first battery energy storage plant in Morocco in the Banjerir region. In reference to the growing industrial and investment interest in this sector locally.