Last updated on December 8th, 2022 at 02:52 pm
Volkswagen will have to multiply its battery purchases to meet its EV expansion targets
Recently, the German carmaker Volkswagen announced more aggressive targets for the transition of light vehicles to electric traction than originally planned. By 2030, the company plans to increase the share of electric vehicles to 70% in the European product range, and globally it will grow to 50%. Experts believe that for this, Volkswagen will have to increase the volume of traction battery purchases significantly.
Now the European auto giant cooperates with almost all major traction batteries: LG Energy Solution (LG Chem), Samsung SDI, SK Innovation, and CATL. Only Panasonic is left behind, which has joint ventures with Tesla and Toyota Motor. By 2025, according to Reuters, Volkswagen will only need to purchase batteries with a total capacity of more than 150 GWh per year to saturate the European market, and the same amount will be required to saturate the Asian market, where China will remain the main consumer.
Accordingly, to meet the demand for electric vehicles in Volkswagen’s declared volumes, by the end of the decade, batteries with an aggregate capacity of at least 300 GWh per year may be required. Bernstein experts have calculated that the company will need 420 GWh of traction batteries to produce 7 million electric vehicles a year. To reach this level of production, Volkswagen will have to invest at least 20 billion euros annually. A shortage of battery cells at this rate of growth is very likely, and those automakers that are already forming long-term contracts and partnerships will be in a winning position.
