Report: Volkswagen Attempts to Create Subsidy Bidding War
Volkswagen is reportedly pausing plans to build a battery plant in Eastern Europe so it can prioritize construction in the United States. Though the situation could be more accurately described as VW notifying EU officials that the U.S. is offering an estimated €10 billion in US incentives as part of the Biden administration’s Inflation Reduction Act (IRA).
It’s not the first time something like this has happened. Volkswagen similarly delayed decisions on where to build a battery plant in December of 2022, telling EU leadership that the Czech Republic, Hungary, Poland, and Slovakia all looked good – but that it wanted to consider its options. This time around, it’s being a little clearer by stating that the U.S. is offering sweeter subsidies and tax incentives than what’s available to Europe.
Betting On Green: Poland Plans to Open Largest Battery Factory in Europe
South Korea’s LG Chem is planning to open the largest lithium-ion battery factory in Europe to aide the continent’s automotive industry as it prepares its much-hyped shift toward EV production. According to LG, construction of the battery plant — located in Wrocław, Poland — is set to begin immediately and batteries should be ready for slotting into vehicles before the end of next year.
In a an announcement, the company said the plant would have a production capacity of 100,000 batteries per year for EVs that can run up to 199 miles once charged. Previous estimates were more conservative but, with German automakers promising widespread electrification, LG saw no reason for half measures.
“We will turn the Poland EV battery plant into a mecca of battery production for electric vehicles around the world,” said company president UB Lee. “As LG Chem’s Poland EV battery plant is the first large-scale automotive lithium battery production plant in Europe, it will play the role of vitalizing the electric vehicle industry across the whole of Europe. We will put all our efforts into making the plant into a main production hub for EV batteries.”