Canada chosen for Volkswagen electric battery factory

Volkswagen is to build its first electric vehicle battery plant outside of Europe in Canada as part of plans to accelerate its North American expansion.

The new factory in St Thomas, Ontario will begin production in 2027, the German manufacturer confirmed yesterday. It will be the company’s third wholly-owned battery plant, in addition to sites in Germany and Spain.

The move will see Volkswagen benefit from new tax incentives and green subsidies offered under President Joe Biden’s Inflation Reduction Act, some of which apply to electric vehicle components produced in Canada.

The new plant will also give it access to key raw materials found in Canada’s large mining sector.