Et was probably Herbert Diess’ last major appearance as Volkswagen boss: On July 8, the company invited to the laying of the foundation stone for its first battery cell factory in Salzgitter, Lower Saxony. In his speech to hundreds of invited guests, Diess spoke of a “historic day for Germany as an industrial location”. Even Chancellor Olaf Scholz came to the celebration.
It is now clear that the long-controversial Diess must vacate the top post of the world’s largest car manufacturer in terms of sales. But the battery cell factory is part of the legacy of the Austrian, who has radically trimmed VW for electromobility in recent years. Volkswagen is investing two billion euros in the factory in Salzgitter, from 2025 battery cells with a capacity of 40 gigawatt hours are to be produced there annually. Enough to equip an annual production of half a million electric cars. The factory, which VW has dubbed “Salzgiga”, is considered a technological lighthouse project. Because the car industry is in an epochal transition from the combustion engine to the electric drive, and the battery cell is the core component for the electric car.
So far, however, Europe’s car manufacturers have been almost completely dependent on Asian suppliers for the supply of electricity storage. The world market leader is the Chinese group CATL. “Salzgiga” and around 30 other battery cell factories planned in Europe by VW, Mercedes, Stellantis and many other manufacturers are intended to bring technological independence to the continent and its auto industry. European governments support the projects with high subsidies. Management consultants McKinsey estimate that a total of 100 billion euros will be invested in this electricity storage offensive by the end of the decade.
German machine builders warn
However, the beautiful story of Europe’s great race to catch up in the race for the automobile market of the future has a downside. Most of the technology for the new VW factory in Salzgitter comes from the country from which one actually wants to become more independent: from China. The mechanical engineering company Wuxi Lead is by far the most important supplier of production systems for the cell factory in Lower Saxony. Even more: The Chinese manufacturer recently announced that it would also be the “core supplier” for the other battery cell factories that VW wants to build in Europe in the coming years. Wuxi Lead can score with low prices for its machines and promises to install large production lines, as VW needs them, reliably and quickly.
The name of the company from Wuxi, a city with over a million inhabitants in eastern China, is only known to experts in Germany. But Wuxi Lead is the world market leader in production systems for the giga factories in the automotive industry and works closely with the battery cell group CATL. The company’s founder, Wan Yanqing, is one of China’s 100 richest people, with an estimated fortune equivalent to more than $5 billion.