JAKARTA - Volkswagen, a German automaker, has just announced plans to build a battery production plant outside Europe, namely in St. Thomas, Ontario, Canada. The plant will begin construction in 2027.

According to Volkswagen's official release on Monday, March 13, Thomas Schmall as the Board Member of Volkswagen Technology revealed that Canada was chosen because of its wealth of natural resources, such as minerals that are important in the production of electric vehicle batteries. VW sees the construction of a battery production plant outside Europe as an advantage, as it expands supply reach and provides access to local resources.

In addition, Canada's strategic geographic location makes it the ideal place to supply vehicles to North America. The factory will later be operated by Volkswagen's subsidiary, VW PowerCo, and will supply vehicles to North America.

"Our big gaugefactory (large factory) in Canada sends a strong message: PowerCo is on track to become a global battery player. With expansion to North America, we will enter the main market for e-mobility and production of battery cells," he said.

Electric vehicles are increasingly popular in North America and Volkswagen see this as a great opportunity to thrive in the electric vehicle market. By building the first gigafactory battery production plant outside Europe, Volkswagen is considered to have taken a major step to support their battery progress.

On the other hand, this step is also important for Volkswagen as it seeks to gain greater incentive benefits from electric vehicles in the US. Moreover, the US made policies that did not support China's battery production.