Volwagen to build new battery plant in China by 2023

BEIJING Reuters - Volkswagen AG said on Thursday it is building a new battery energy storage cell in the Hefei city of eastern China which will start production by 2023.

The German automaker is building a factory for electric vehicles under a majority-owned venture in Hefei city in collaboration with JAC. It also holds stakes in the EV battery maker Gotion that is also based in Hefei.

It said it would invest more than 140 million euros $164 millions in the battery plant by 2025. The factory's initial capacity will be 150,000 to 180,000 battery systems a year for local EV production.

Volkswagen has released five IDs. electric models in China, the biggest car market in China, this year. It sold around 7,000 such cars there last month and aims to produce 80,000 to 100,000 units in total this year.

Reuters reported last week that citing people familiar with the matter, Volkswagen is in talks to tighten its grip on the Hefei venture sparking tensions with its other Chinese partners who fear they could be sidelined.