Electric Vehicle

Volkswagen doubles the amount allocated for battery cell contracts to about $48 billion

Volkswagen plans to significantly expand electric vehicle production next year with several new vehicles leading to market therefore is securing its battery supplies.

The company had announced last year a production plan called “Roadmap E” which aims to build up to three million electric vehicles annually by 2025 and market 80 new electric Group models.

The company has now almost doubled the amount allocated for battery cell contracts to about $48 billion. However, it will not immediately be investing $48 billion into the production of batteries for electric vehicles.

Volkswagen is not relying upon building their own batteries but instead is signing long-term contracts with battery manufacturers and encouraging them to invest in their own production capacity in order to grow with Volkswagen electric vehicle production capacity.

The German automaker has not disclosed any specific battery manufacturers for its contracts, but they could be LG Chem, Samsung SDI, Panasonic, CATL, as per some media reports.

It is also reported that the contracts are likely to include clauses based on the progression of battery technologies and cost over the next decade which is bound to improve with time.

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