Volkswagen Group, through its subsidiary PowerCo, and Gotion High-Tech have announced the creation of a joint venture in Kénitra, Morocco, to produce cathode materials for electric vehicle batteries. The partnership aims to strengthen the Moroccan ecosystem for electric mobility and battery manufacturing. Morocco Now highlights that this move solidifies Morocco's position as a strategic hub for electric mobility and battery manufacturing due to its competitive industrial ecosystem and strong connectivity with international markets.
The joint venture is part of a broader partnership between Volkswagen, PowerCo, and Gotion, which began in 2020. The partners have agreed to create three joint ventures in Valence, Spain; Šurany, Slovakia; and Kénitra, Morocco, for the industrial production of lithium iron phosphate (LFP) battery cells and cathode materials. The agreement also includes joint procurement and sales activities in Europe. As part of the deal, Volkswagen will sell 5.3% of its stake in Gotion to optimize its shareholder structure and support long-term strategic synergies.
The LFP batteries offer competitive costs, long lifespan, and high robustness, making them a key technology for affordable large-scale electric mobility. According to forecasts, the demand for LFP batteries in Europe is expected to grow strongly in the coming years, with the market share potentially increasing from around 10% to 40-60% by 2030. However, Europe currently lacks significant LFP battery production capacity. Thomas Schmall, a member of the Volkswagen Group's board of directors for Technology and president of PowerCo SE's supervisory board, expressed his satisfaction with the partnership extension.
The Kénitra joint venture plans to establish a new production unit for cathode materials for LFP batteries. This unit will contribute to diversifying the sources of essential active materials for cathodes, strengthening supply security, and developing the regional value chain. Gotion will hold 51% of the shares and be the majority shareholder in the joint venture. PowerCo and Gotion will jointly manage the venture. Li Zhen, president of Gotion High-Tech, highlighted the six years of close collaboration between Volkswagen and Gotion.
The partnership between Volkswagen and Gotion has led to a deep mutual trust and a mutually beneficial relationship that has long gone beyond a simple commercial framework. Today, with Volkswagen Group and PowerCo, they are accelerating their global strategic cooperation. The companies are concretizing their common strategy of localizing battery production in Europe and seizing opportunities in the global electric mobility market. Frank Blome, CEO of PowerCo SE, emphasized that the partnership with Gotion is a new important step.
Volkswagen, PowerCo, and Gotion have been collaborating closely and successfully since 2020. Gotion is both a supplier of cells for Volkswagen Group and a strategic partner of PowerCo. Through these new joint ventures, the partners are extending their proven cooperation to the industrial production of LFP battery cells and cathode active materials. The agreement supports Volkswagen Group's long-term projects to establish a European battery supply chain and strengthens PowerCo's growth plan.
In terms of financial details, PowerCo is expected to invest around €470 million in the Šurany and Kénitra sites by 2030 to acquire its 49% stake. The agreement is subject to regulatory approvals and customary closing conditions, including approval from Gotion's general assembly. The joint venture is expected to play a significant role in the development of the electric mobility sector in Morocco and Europe.
Key points
- Volkswagen and Gotion are creating a joint venture in Kénitra, Morocco, to produce cathode materials for electric vehicle batteries.
- The partnership aims to strengthen Morocco's position as a strategic hub for electric mobility and battery manufacturing.
- The joint venture is part of a broader partnership between Volkswagen, PowerCo, and Gotion to produce LFP battery cells and cathode materials in Europe.
