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China's Gotion invests $1.25 billion in Volkswagen battery plant in Spain - Finance news and analysis from Global Banking & Finance Review
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China's Gotion invests $1.25 billion in Volkswagen battery plant in Spain

Published by Global Banking & Finance Review

Posted on September 28, 2026

2 min read

· Last updated: September 28, 2026

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Gotion to Invest $1.25 Billion in Volkswagen’s Valencia Battery Plant

Gotion's Strategic Investment and Its Impact on the European Battery Market

By Rachel More

Overview of the Investment

BERLIN, Sept 28 (Reuters) - China's Gotion will invest €1.1 billion ($1.25 billion) in Volkswagen's battery plant in Valencia under a broader plan to jointly develop a European battery supply chain.

Chinese Expansion in Europe

Chinese companies are boosting their presence in Europe ahead of expected moves by Brussels to shield EU industry from cheaper imports, including electric vehicles from China threatening to slash the market share of Volkswagen and other EU heavyweights.

Details of the Stake and Plant Operations

Gotion's investment allows it to take a 49% stake in the Valencia plant of Volkswagen's battery business PowerCo, which will remain the majority shareholder, VW said.

Production Focus: Lithium Iron Phosphate Batteries

The plant will become a European production hub for lithium iron phosphate, or LFP, batteries.

PowerCo's Reciprocal Investments

PowerCo, for its part, will invest €470 million in two Gotion sites – a cell factory in Šurany, Slovakia, and a new production facility for cathode material in Kenitra, Morocco – for a 49% stake in each.

Statements from Volkswagen Leadership

VW technology chief Thomas Schmall said the move "marks a major breakthrough for both companies and brings us one step closer to the forefront of electric mobility".VW is Gotion's largest single shareholder, with 24%. It said it had agreed to sell a 5.3% stake - worth $373 million according to LSEG data - to an unnamed buyer.

Volkswagen's Corporate Restructuring

The German group is currently undergoing the most radical overhaul in its history, cutting 100,000 jobs, and also wants to drastically reduce its sprawling investment portfolio.

Currency Exchange Rates

($1 = 0.8800 euros)

($1 = 6.7103 Chinese yuan)

(Reporting by Rachel More; editing by Thomas Seythal and Kevin Liffey)

Key Takeaways

  • Gotion expands in Europe ahead of stricter EU trade safeguards—and VW maintains control with 51% stake in Valencia gigafactory.
  • Investment is part of a broader €3.22 billion cooperation across Spain, Slovakia and Morocco for battery and cathode production.
  • The strategic deal strengthens VW’s supply chain resilience as it undergoes a major corporate overhaul, including job cuts and asset disposals.

Frequently Asked Questions

How much is Gotion investing in Volkswagen's battery plant?
Gotion is investing €1.1 billion ($1.25 billion) in Volkswagen's battery plant in Valencia, Spain.
What stake will Gotion have in the Valencia battery plant?
Gotion will acquire a 49% stake in Volkswagen's Valencia battery plant.
What type of batteries will the Valencia plant produce?
The Valencia plant will serve as a European production hub for lithium iron phosphate (LFP) batteries.
How is PowerCo involved in Gotion's operations?
PowerCo will invest €470 million in two Gotion sites for a 49% stake in each, including a cell factory in Slovakia and a cathode facility in Morocco.
Why are Chinese companies increasing their presence in Europe?
Chinese companies are boosting their presence in Europe ahead of expected EU measures to protect local industries from cheaper imports.

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