Volkswagen AG has agreed to sell a 49% stake in its Sagunto battery gigafactory project in Valencia, Spain, to Chinese battery manufacturer Gotion High-Tech for roughly €1.1 billion. The transaction forms part of a broader industrial realignment that shifts the project’s production timeline to 2027 while restructuring three joint ventures across Europe and North Africa.
Sagunto Ownership and Investment Structure
Volkswagen’s dedicated battery subsidiary, PowerCo, will retain the remaining 51% majority stake and operational control of the plant. According to financial disclosures, the total investment for the Spanish site is projected to reach over €2,300 million. The joint venture is designed to establish Sagunto as a primary European manufacturing hub for lithium-iron-phosphate (LFP) battery cells, supplying entry-level electric vehicles across the Volkswagen Group, including models built in Spain such as the Cupra Raval and Skoda Epiq.
Cross-Border Joint Ventures in Slovakia and Morocco
The agreement between Volkswagen and Gotion extends beyond Spain to encompass two additional industrial projects located in Šurany, Slovakia, and Kenitra, Morocco. In contrast to the ownership arrangement in Valencia, Gotion will hold a 51% controlling stake in both the Slovakian and Moroccan entities, while Volkswagen’s PowerCo will take a 49% minority position in each. PowerCo has committed to investing approximately €470 million into these two facilities. The Slovakian plant will produce lithium batteries on a smaller scale than Sagunto, whereas the Kenitra facility in Morocco will focus on manufacturing lithium iron phosphate cathode materials to secure raw material supply chains. To consolidate this multi-plant partnership, Volkswagen has simultaneously announced the sale of a 5.3% equity stake in Gotion High-Tech, reducing its previous shareholding of roughly 25% while retaining its voting rights.
Production Timeline Revisions and Capacity Targets
The restructuring of the partnership has prompted a revision of the operational schedule for the Sagunto gigafactory. Rather than launching operations with a single production block as originally planned, the facility will now initiate manufacturing with two parallel blocks. This change pushes the projected start of operations to 2027, following earlier delays that had targeted trial runs for December 2024. The two initial blocks will generate an estimated 30 GWh of combined annual capacity and are expected to create 1,500 direct jobs.