Gotion High-Tech, a Chinese battery maker, will build a battery factory with Volkswagen in Germany, the company announced on Tuesday. Gotion is the latest Chinese battery manufacturer to expand overseas, with its eyes on European automakers embracing electric vehicles.

Why it matters: The new plant will help Volkswagen increase electric vehicle production. By 2030, the automaker wants half of its car sales to be electric to comply with stricter emission rules.

  • Volkswagen pledged to phase out fossil-fuel cars in major markets by 2040 and become carbon neutral by 2050.

Details: Extending an existing partnership signed in May 2020, Gotion and Volkswagen will partner to build a battery cell factory in the German state of Salzgitter. The factory is scheduled for operation in 2025.

  • Gotion will provide technical support for laying out the factory, machinery, production processes, among others, according to company statement on Tuesday. The factory will be Volkswagen’s second battery gigafactory in Europe. 
  • On Tuesday, the German automaker revealed plans to open six gigafactories with a total capacity of 240 gigawatt-hours (GWh) across Europe by 2030. The plan, while ambitious, comes short when compared to its US counterparts. Tesla said last September it plans to generate 3,000 GWh of battery production capacity over the next decade.
  • Gotion will also begin developing the first generation of unified cells for Volkswagen in the Chinese market. Unified cells are a new battery design that could cut costs by half, Volkswagen said in September. Gotion said it is the first battery supplier to build the new batteries for Volkswagen China.

Context: Chinese battery makers are expanding their overseas production capacity to maintain China’s leading position in alternative fuel technology. 

  • CATL, a Chinese battery maker and a Tesla supplier, began building its first production site in Europe in Thuringia, Germany, in mid-2018. The company expects to start supplying BMW later this year with an initial annual capacity of 14 GWh.
  • In March, Chinese EV and battery maker BYD began recruiting engineers for its first overseas battery plant in Europe, without detailing location or manufacturing capacity, Reuters reported.

Jill Shen is Shanghai-based technology reporter. She covers Chinese mobility, autonomous vehicles, and electric cars. Connect with her via e-mail: or Twitter: @yushan_shen