The battery-manufacturing subsidiary PowerCo SE of Volkswagen Group has officially launched construction on its new $7 Billion gigafactory in St. Thomas, Ontario. The facility represents a decisive move into the North American electric-vehicle battery market despite global trade pressure. The project underlines Volkswagen’s commitment to localising production and strengthening its supply-chain footprint. Ground-works and civil engineering works are underway and major contractors are mobilising on site.
The region’s infrastructure is also being upgraded in parallel to support the complex. Local utilities, roads and logistics assets are receiving investment ahead of the main build. Work has begun on site preparation, and the company has flagged 2027 as the target production start. The ambition is to position this plant as a hub of advanced cell manufacturing in the North American market.
Project Factsheet
Location: St. Thomas, Ontario, Canada
Investment: Up to €4.8 billion (approx. CAD $7 billion) by 2030
Annual capacity (final expansion phase): Up to 90 GWh
Job creation: Up to 3,000 direct jobs and tens of thousands of indirect jobs
Production start: Targeted 2027
Significance of the project
This project marks a major strategic pivot because the company shifts from vehicle assembly to full-spectrum battery cell production and recycling. By selecting a Canadian site, it taps clean energy, proximity to raw materials and tariff avoidance. Moreover, the local economy stands to benefit through job creation, supplier-spin-offs and increased regional industrial activity. This builds local capabilities and strengthens the ecosystem for electric-vehicle manufacturing.
Beyond those direct effects, the plant adds substantial value for the construction and infrastructure sectors. Its scale means high demand for heavy-civil works, structural steel fabrication, advanced utilities and sustainable building systems. Moreover, as seen in NextStar Energy’s completion of its US$5 billion EV battery plant strengthening the North American supply chain , such large-scale initiatives showcase how industrial projects can transform regional construction capabilities. In addition, the standardised factory design being adopted globally by Volkswagen means lessons learned here will ripple across future megaprojects, improving cost-efficiency and risk-mitigation.
