PowerCo will open its cell factory in Canada no earlier than 2029.
Volkswagen’s subsidiary PowerCo has significantly delayed the schedule for its battery cell production facility in St. Thomas, Canada. The company now expects operations to begin in 2029, whereas construction was originally planned to start in 2027.
Construction site of PowerCo’s cell factory in St. Thomas
Image: PowerCo
PowerCo announced the schedule delay casually as part of the appointment of a general contractor for the St. Thomas project, which we will discuss further below. Yet what’s even more interesting is undoubtedly the fact that Volkswagen’s battery subsidiary is now drastically pushing back the opening of the factory that was announced in 2023.
The facility in Ontario province, which was once intended to have an annual production capacity of up to 90 GWh, was originally scheduled to begin operations in 2027. PowerCo confirmed this last year as well, when three large buildings started construction. The battery cells produced there are meant to be used primarily in Volkswagen Group’s electric vehicles manufactured in North America, including those for the revived Scout brand, which plans to deliver its first vehicles to customers in 2028 — but not yet with cells from St. Thomas.
In fact, production there is now expected to start about two years later than 2027: the St. Thomas facility is likely to begin operations in 2029. PowerCo cites several reasons for this delay: changing market demand, technological advancements, and the Volkswagen Group’s long-term strategy.
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It is also intended to enable an earlier start of production by allowing the immediate integration of “next-generation battery technology,” while ensuring flexibility for future scaling as the market evolves. Additionally, Volkswagen is known to be looking for a partner or investor for PowerCo, which could be why it is slowing down progress. Recently, there have been rumors that the Chinese cell manufacturer Gotion might invest in PowerCo’s cell factory in Sagunt, Spain.
Joel Karlsberg, PowerCo Canada’s Chief Procurement Officer, clarifies, “The gigafactory in St. Thomas remains a cornerstone of our North America strategy. We are continuing construction while simultaneously evaluating how and when the facility will scale over time. The goal is to find the right pace—without backing down—to protect our long-term investment, secure jobs in the region, and position Canada, Ontario, and St. Thomas optimally in a dynamic and evolving market.”
A quick note on the new general contractor for the construction site in St. Thomas: it is the leading Canadian construction company EllisDon. According to PowerCo, this appointment enables them to continue work on site and build upon the steady progress made since groundbreaking in 2025. The construction is now moving into the core infrastructure and structural phases, which will support future production. Currently, around 60 employees from EllisDon are on site; this number is expected to rise to about 1,300 during the peak phase, in addition to further staff supporting parallel project activities.