AutoForecast Solutions expects the plant to supply batteries for Volkswagen, Audi and Scout Motors brands by 2030
Volkswagen Group’s first North American battery cell plant, announced for St. Thomas, Ont., is poised to build manganese-rich lithium ion battery cells, as the German automaker rolls out a tiered battery strategy for its lineup of electric vehicles, according to analysts at U.S.-based AutoForecast Solutions (AFS).
Sam Fiorani, vice-president of global vehicle forecasting at AFS, said he expects the Canadian plant to supply batteries for at least five high-volume models across the Volkswagen, Audi and Scout Motors brands by 2030.
The automaker shared plans for its first major Canadian investment March 13, but provided no specifics about the plant’s capacity, the technology it will use, or the scale of the investment. Volkswagen and its in-house battery subsidiary PowerCo are expected to lay out further details at an event in St. Thomas, midway between Toronto and Windsor, in the coming weeks.
In the interim, the company would not comment on its future product plans, or share further details about its Ontario plant.
But Conrad Layson, senior alternative-propulsion analyst at AFS, said the three-tier battery strategy Volkswagen first shared in 2021, and its partnership with Belgium-based materials company Umicore, point to production of manganese-rich batteries in Ontario, though the exact chemical composition is unclear.
Automotive experimentation with high-manganese batteries has been urgent in recent years, Layson said, as they can be built more cheaply than the nickel manganese cobalt (NMC) batteries used in most North American EVs today. Manganese-rich chemistries also offer greater range than the lithium iron phosphate (LFP) batteries common in China, and gaining popularity elsewhere.
“It has a higher energy density than LFP, that’s its virtue,” Layson said.
At its 2021 Power Day, Volkswagen laid out its battery roadmap, built around what it calls a “unified” cell platform. Each of the company’s batteries will use the same physical battery shell, helping to cut costs, but the cathode chemistry will vary, it said.
The approach will create a tiered battery offering, letting customers prioritize either cost or range. Volkswagen said it plans to use LFP for the battery packs in its entry-level models, manganese-rich cells for high-volume variants, and pricier NMC cells for performance vehicles and others that require “specific solutions.”
The company would not comment on what type, or types, of cells would be produced in St. Thomas.
The automaker’s budding partnership with battery materials company Umicore, however, points to manganese-rich cells.
Umicore announced plans to build a precursor and cathode active materials (CAM) plant in Loyalist Township, just outside Kingston, Ont., in July 2022.
Since then, it has signed a pair of agreements with Volkswagen’s battery unit. One of them is a joint venture deal to produce CAM alongside PowerCo in Europe. The other, which currently remains non-binding, extends this partnership to North America, establishing PowerCo as an “important customer” for Umicore’s Eastern Ontario plant, the company said in December.
At the same time, Umicore has been finalizing plans to push manganese-rich battery materials into production by 2026.
A company spokeswoman said the “high lithium, manganese” product Umicore calls HLM, is 25 per cent more energy dense than LFP — translating into superior vehicle range. The company also sees a 10-per-cent cost advantage for HLM over “non-Chinese production” of LFP, she added.
In February, Umicore said it expects to produce HLM at its new Canadian plant, though this would not necessarily preclude it from also producing NCM cathode material, as the company claims both can be produced at the same plant.
PowerCo plans to begin producing its “unified” cells in St. Thomas in 2027.
AFS forecasts the plant will supply no fewer than five battery-electric nameplates across three Volkswagen Group brands by 2030, and likely several more.
These include a Scout-branded pickup and an SUV to be built at a newly announced assembly plant in South Carolina, and at least two models in Volkswagen’s ID lineup, to be built in Chattanooga, Tenn., Fiorani said. A new North American Audi plant that will produce a battery-electric version of the Audi Q5, as well as another upcoming model, is also likely, he added.
AFS forecasts that across the three brands, Volkswagen will be producing 320,000 battery-electric vehicles per year in North America by 2030.
Source:Automotive News
