Last year, VW unveiled plans to build six battery cell production plants in Europe by 2030, including the facility in Salzgitter, Germany, and one in Skellefteå, Sweden. A third plant will be established in Valencia, Spain, and the fourth factory will be based in Eastern Europe. The plants will eventually have a production capacity of 240 gigawatt-hours a year.
The Inflation Reduction Act, which was signed into law earlier this month by President Joe Biden, revamps the EV tax credit by adding tough new requirements about parts and supply chains. To qualify, EVs must be assembled in North America or by a US trading partner and must include battery components that are mostly sourced in North America.
VW recently began production of its flagship EV, the ID.4 crossover SUV, at its plant in Chattanooga, Tennessee. Even so, the automaker emailed customers recently to say it “cannot guarantee” that the EV will be eligible for the tax credit due to the fact that its batteries are not made in North America. Other automakers are similarly scrambling to shift supply chains to ensure they are eligible for the $7,500 customer incentive.