On 30 September 2026, the Basque Government presented the project at the Mercedes factory in Vitoria-Gasteiz The project, Fabricación Flexible de la nueva Automoción, provides for an initial public-private investment of €181 million over the next three years, including around €61 million for research and development. The aim is to modernise production technology at the plant, make it more flexible and enable future van model ranges to be built with different powertrains.
The Lehendakari Imanol Pradales said the project was necessary to pick up the pace in international competition and make industry more decarbonised, technologically advanced and competitive. He also called for decisive industrial policy decisions in Europe to protect the market and production. The minister responsible for the region, Mikel Jauregi emphasised that the project was a shared undertaking by business, research and the public sector, led by the Gobierno Vasco.
On behalf of the company, plant director Bernd Krottmayer highlighted the importance of flexible equipment and processes to adapt production programmes quickly to market conditions. The Diputado General of Álava, Ramiro Gonzálezpointed to the site’s significance beyond the region for value creation and employment. He said the investment would have an impact beyond the factory gates, reaching the province’s industrial ecosystem.
A current example is the electric Mercedes-Benz VLE, which is scheduled to go into production this year. According to the authorities, the new model family replaces the previous EQV and introduces structural improvements, enhanced electronic functions and advanced safety systems. For the plant, greater flexibility means being able to build different vehicle architectures and powertrain variants on one line, and thus respond more quickly to technological developments and demand.
For now, the precise timetable for individual measures and support instruments over the three-year period remains unclear. No specific employment effects have been detailed either. What is clear is that the refit will require closer cooperation with regional suppliers and research institutions, and is likely to bring new skills requirements for the workforce. The Basque Government sees this as one way to safeguard industrial expertise in Euskadi and retain more value creation in Álava.
Editor: Phillipe Schmidt-Araguin (Article created with AI assistance).