Volkswagen Looks to Build New Electric Vehicle and Battery Facilities in US

UTC by Tolu Ajiboye · 3 min read
Volkswagen Looks to Build New Electric Vehicle and Battery Facilities in US
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Volkswagen wants to ramp up its electric vehicle and battery efforts in the US starting with the newly-unveiled Chattanooga plant.

According to Volkswagen Group of America CEO Scott Keogh, the German car manufacturer wants to establish new electric vehicle and battery facilities in the US.

“We are actively in the process of looking at another production facility and also looking at a battery facility,” Keogh stated in an interview.

Although Keogh did not comment on possible locations for the facilities, Volkswagen currently has North American assembly plants in Tennessee and Mexico. The Tennessee electric plant includes localized production of the VW ID.4 crossover electric vehicle, slated to begin later this year.

Volkswagen Electric Vehicle US Production

The Volkswagen scope of ramping up EV production facilities in the US is part of a broader goal targeted by the Biden administration. Expectedly, these facilities would also likely translate to a huge sum of fresh capital in new US investment for Volkswagen.

The German motor vehicle manufacturer recently unveiled a $22 million electric vehicle battery lab near its only American assembly plant in Chattanooga. Volkswagen will test and optimize batteries for the US market electric vehicles at this new 32,000-square-foot battery lab. Furthermore, the automaker also announced that the plant is one of four such facilities planned across the globe.

This new operational zone is also part of Volkswagen’s $7.1 billion commitment to ramping up EV efforts in North America. This also includes the increase in US availability and sales of electric vehicles in the second half of the year. Sales will begin with the ID.4 crossover model.

Since 2021, Volkswagen has been importing the ID.4 from Germany in limited monthly quantities of no more than 2,000. However, localizing production of the model line at its Chattanooga plant will increase the number of ID.4 models to 7,000 by the end of this year. Keogh said:

“We don’t want to launch with 100 cars. We want to launch with a few thousand built up. This is huge.”

The Volkswagen of America CEO also gave working expectations for the Chattanooga plant. According to him, production capacity should hit 10,000 ID.4 EVs per month once fully up and running. In addition, the plant would also run three shifts of workers in the line of operations.

Volkswagen sold 16,742 ID.4 models throughout last year, and only 2,755 models in the first quarter of 2022.

Volkswagen Currently Ahead of Pack in Projected US EV Output

Official US production of the Volkswagen ID.4 will most likely begin next month, going by current expectations. In fact, pre-production models of EV SUVs planned for testing are currently undergoing assemblage at the eastern Tennessee plant. Also, according to Keogh, ID.4 models will become available for purchase at US dealerships as early as September this year. Volkswagen hopes that speeding up production of its EV line would put it ahead of competitors. The company wants to get ahead of others like American EV automaker Rivian (NASDAQ: RIVN) and traditional manufacturers like General Motors (NYSE: GM).

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Tolu Ajiboye
Author Tolu Ajiboye

Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to demystify crypto stories to the bare basics so that anyone anywhere can understand without too much background knowledge. When he's not neck-deep in crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.

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