Volkswagen, its battery subsidiary PowerCo and Gotion High-Tech agreed on 28 September 2026 to deepen their strategic alliance through a joint company. The Joint Venture is to take over the development and operation of the battery cell plant in Sagunto (Valencia) in Parc Sagunt II under construction. The companies involved estimate the investment at 1.1 billion euros. The aim is to strengthen Sagunto as a strategic European location for battery technology based on lithium iron phosphate (LFP).
According to the companies and consistent media reports, the agreement involves close technical and industrial cooperation. Details of ownership stakes, the joint company’s governing bodies and payment schedules were not published on Monday. An updated timetable for construction progress and the start of production was also not yet available. The factory is a core PowerCo project to supply several group plants in southern Europe and was designed from the outset for high-volume cell production.
The choice of LFP technology is aimed at robust, cost-effective cells suited to high-volume vehicle segments. This positions Sagunto in a market segment that is gaining considerable importance worldwide. For the Valencia region, the agreement is another milestone in an industrial project already seen as a driver of jobs and value creation before this latest step. No figures for specific employment, local supply chains or training programmes were provided on the day of the announcement.
What is established is the next step in integration between Volkswagen, PowerCo and Gotion High-Tech at the Sagunto site. Attributed statements about future capacity, expansion stages or export shares remain provisional company targets until reliable contract details or construction and production figures are published. Local authorities and social partners are likely to comment on requirements for infrastructure, grid connections and site logistics following formal confirmation of the joint venture.
The project announced today brings Sagunto further into the European battery network. Follow-up information from the companies involved will show whether and how the agreement affects existing PowerCo programme strands – for example, the chemical diversity of cell formats or the integration of additional suppliers.
Editor: Mira Cadena (Article created with AI assistance).