Execs share VW’s roadmap to going green with kidnapping London audience

At the Manufacturing Matters conference Thursday, Kai Fahrbach was waiting patiently for a chance to speak with Volkswagen Canada.

Article content

The automotive parts supplier from Woodstock was not alone.

Article content

RBC Place was packed for the morning meeting to hear keynote speakers from the German automaker, and many in attendance were suppliers hoping to get a slice of their business.

“It is a great opportunity, great for the whole supply chain to have such a big (automaker). This will grow the entire industry,” said Fahrbach, business development manager at Toyota Tsusho in Woodstock.

A supplier to Toyota and Ford, Fahrbach will offer VW warehousing and tire and wheel assembly. The company is keenly interested in recycling EV parts, Fahrbach said.

“We would love to be a supplier to VW. We are looking at the potential.”

Pierre Boutin, president of Volkswagen Group Canada, and Robert Weggaesser, chief financial officer of the automaker’s St. Thomas plant, were the keynote speakers at the Manufacturing Matters conference.

Article content

The plant, for which land is now being cleared, will occupy 150 hectares in St. Thomas when it’s built. But there is 600 hectares in the industrial park where the plant is located, meaning a lot of land will be available to suppliers as well as other industry.

“There has been a lot of interest,” Boutin said after his address. “We will look at suppliers from all over but we think we can find a lot here in Southwestern Ontario. It’s still too early to say.”

Volkswagen, through its subsidiary PowerCo, is opening a gigafactory that will make cells for electric vehicle batteries in St. Thomas in 2027, a $7-billion investment that will employ 3,000.

The automaker will hold “supplier days” next year, where industry will be invited to meet with PowerCo and Volkswagen. At the morning breakfast meeting VW even made available a link to a supplier form for those in attendance to fill out.

Article content

“We don’t want to set expectations too high, to promise the moon, but people will see the economic impact which will be very substantial,” Boutin said.

It is too soon to know how many new industries will locate in London and area or existing ones add workers as a result, but area economic development agencies already are answering calls.

“There is interest from a number of suppliers, everything from paper products to parts, but it is still early,” said Sean Dyke, chief executive of the St. Thomas economic development office.

“We will have land available next year we will be able to sell, but we are really focused on developing the PowerCo plant.”

Dyke would not be surprised if the region attracted suppliers to several plants including the Stellantis EV plant in Windsor now under construction, Cami Assembly’s battery plant it is building near Woodstock, as well as the just-announced Quebec EV battery plant.

Article content

“The recent addition of industrial lands has positioned London well for opportunities with EV suppliers. A collaborative effort with Volkswagen, educational institutions and regional partners is creating momentum for London and surrounding area,” said Kapil Lakhotia, chief executive of the London Economic Development Corp. that organized the event.

The plant will have capacity to make cells for about one million batteries a year. A battery makes up about 40 per cent of the cost of an EV vehicle.

During their talk, Boutin and Weggaesser spoke of the greening of Volkswagen and its goal to reduce vehicle emissions by 30 per cent by next year compared to 2015 and be carbon neutral by 2050.

Article content

“We have a detailed roadmap to decarbonize our entire company,” Boutin said.

As for EV sales targets, it hopes to increase sales of the vehicles this year by 10 per cent, 20 per cent by 2025 and 50 per cent by 2030.

“Suppliers, many of whom may be in this room, will be at the center of this transformation,” Boutin said.

He praised governments and agencies in the region for their support, and cited access to energy supply, an experienced workforce, transportation infrastructure as well as a supply chain including critical minerals, as reasons the automaker is building here.

Volkswagen plans to introduce 25 new EV models by 2030 and is installing 45,000 fast chargers in China, Europe and North America.

PowerCo has one plant in Salzgitter, Germany, is building another in Valencia, Spain, that will open in 2026 and has plans to add another in Europe in 2028.

The St. Thomas gigafactory will be the largest EV factory in its network.

[email protected]

Twitter.com/NormatLFPress

Article content