WOLFSBURG/VALENCIA (dpa-AFX) - The Valencia region in Spain is now finally set as the next location for the VW Group's European battery cell network. A plant with more than 3,000 employees is to start operations there in 2026, the automaker announced Wednesday. At the turn of the year, a suitable plot of land was purchased in Sagunto, it said. The city is located about 300 kilometers southwest of Martorell, where the subsidiary Seat has its headquarters. In addition, the new cell factory is to help supply the vehicle plant in Pamplona. In the center of Valencia, VW's battery division PowerCo now also has its own branch to coordinate activities in Spain from there.

In principle, the project had already been known since last spring - Volkswagen, however, wanted to check the funding conditions of the government before making a final decision. In this context, Europe's largest carmaker had applied for a program called "Future Fast Forward", which involves other companies in addition to VW and Seat. According to current information, a good ten billion euros are to flow into the overall project.

The Spanish central government had provided the autonomous community of Valencia with 90 million euros as a subsidy for the battery factory at the end of December. After Salzgitter in Lower Saxony, the region will be the next place where the VW Group wants to produce its own battery cells for electric cars - not least to become less dependent on the dominant suppliers from Asia. If a plant of the partner Northvolt in Skellefteå in northern Sweden is included, it is the third such location. Another cell factory is to come to Eastern Europe, but no definitive decision has yet been made on this.

"In Spain, we are now starting to build up the management team and will soon begin initial construction work," explained PowerCo CEO Frank Blome. "Further steps for Eastern Europe and North America are in the planning stage." German politicians and VW's works council are also hoping for additional investment here at home. According to reports, East Frisia around the Emden plant or the region around the Zwickau, Chemnitz and Dresden sites in Saxony could have opportunities.

The Spanish project is also about complementary parts and production processes for e-mobility. For the battery cell production itself, VW is targeting an electrical energy of 40 gigawatt hours per year. The Sagunto site is to be powered by green electricity. The group began a campaign to recruit skilled workers.

A total of six internal cell factories are initially planned in Europe. But VW is also exploring conditions for North American manufacturing. During a visit by German Chancellor Olaf Scholz (SPD) to Canada in August, a memorandum of understanding to promote electromobility had been signed with the government there. Wolfsburg plans to invest in Canadian mines in order to secure battery raw materials.

Other automakers are also building their own cell plants or getting involved in joint projects, often costing billions. Recycling is also becoming more important. In China, Volkswagen tends to rely on investments in and cooperation with partner companies such as Gotion./jap/DP/men in battery production.