Germany, Sweden and Spain. The factory that the Volkswagen Group will build in Sagunto (Valencia) will be the third of the six that they plan to build in Europe by 2030: a gigafactory that will produce the batteries for the German consortium’s electric cars. Now we can talk about it in the future and not in the conditional because they waited until the last business day to communicate that they had accepted the PERTE aid. Almost 400 million euros for Volkswagen and the Government to reconcile: these are all the benefits of the ‘signed’ peace.
Wayne Griffiths, CEO of SEAT, confirmed the news in a video: “Today is a historic day for all of us. We take a strategic step: SEAT, the Volkswagen Group, PowerCo and the companies of the Future: Fast Forward project have accepted the PERTE VEC resolution and together we will invest 10,000 million euros in Spain”. They did it the same day that the term ended and after several weeks negotiating with both the Government and the autonomous communities involved.
€10 billion
Within the PERTE (Strategic Projects for Economic Recovery and Transformation), the electric and connected car has its own section: that is where the €397 million that have served for the Volkswagen Group and the Government to ‘sign’ peace, thus banishing the doubts that had been generated around the gigafactory.
The idea of ”transforming Spain into a European electric mobility hub” continues. That is the main objective of the Future: Fast Forward project, which is the one that has obtained the most funds from this first edition of PERTE. An investment that goes beyond the Sagunto battery factory: part of it will also go to the electrification of the Volkswagen factory located in Landaben (Navarra) and the SEAT factory located in Martorell (Barcelona).
Today we reach a key stage on our way to accelerate the electrification of Spain by accepting the PERTE VEC resolution. pic.twitter.com/v6uEDaIEKc
— Wayne Griffiths ⚡ (@WGriffithsCEO) November 9, 2022
The (good) consequences for Spain
Converting Spain into an infrastructure where companies related to the electric car are grouped together, which many consider the future of the motor industry, translates into positive consequences for our country: it will generate new jobs, boost the role that the Port of Sagunto already plays and could be the definitive push to shape the Mediterranean Corridor.
3,000 direct jobs
In the roadmap of the factory, which will be located in Parc Sagunt II, its construction is scheduled to start in the first four months of 2023: the goal is for production to start in 2025 to be fully operational in 2026.
Wayne Griffiths has insisted that it is a project that “will promote the transformation” of Spanish industry and, furthermore, “will help create thousands of new jobs and maintain the country’s competitiveness”. According to the estimates made, the gigafactory will generate 3,000 direct jobs and up to 12,000 indirect (some say it will be 9,000).
In The Provinces report on the profiles that the Volkswagen Group needs for the new battery factory, highlighting the variety of positions: unskilled labor, specialized in mechanics or electronics, graduates, engineers, other profiles that have nothing to do with the motor industry (cleaning or restoration, for example)…
One of the most popular degrees is Chemical engineering in almost all its specialties. At the same time, workers with previous experience in automotive production, automated manufacturing, robotics, control systems and technology, process simulation, etc. will be required. The Council of the Valencian Community, for its part, has invested 15 million euros to create a new VT centre, which will be located next to the factory and will focus on training young people who will then be able to work in the facilities of the Volkswagen Group.
Up to 12,000 indirect jobs
As we pointed out before, the new Sagunto gigafactory will create up to 12,000 indirect jobs, although there are reports that speak of 9,000 jobs of this type. Be that as it may, the Future: Fast Forward project is made up of 60 companies: of these, 61% are SMEs from eleven autonomous communities.
And it is that the arrival of this new plant gives rise to the creation of a whole conglomerate of companies related to the object of production, just as it already happens with the car factories that are distributed throughout our country. Notably This business group is the largest in the history of the automotive industry in Spain and encompasses the entire value chain of the electric vehicle.
The Port of Sagunt
One of the reasons that tipped the balance in favor of Sagunto as the location for the Volkswagen Group’s battery factory was its location strategy: not only is it close to the port of the town itself, but also to those located in Valencia and Gandía. Managed all three by the Port Authority of Valencia, occupy the fourth position in Europe and They lead the freight traffic in the Mediterranean. A transfer that promises to increase with the necessary arrival of components to produce the batteries.
The Mediterranean Corridor
The arrival of the gigafactory in the Valencian Community could be the definitive impulse to shape the Mediterranean Corridor. The historic infrastructure, which has been stagnant for many years, aims to unite Andalusia with Catalonia crossing a total of ten cities with more than 100,000 inhabitants.
In 2022, the General Budgets have dedicated an allocation of €1.7 billion (10% of the investment of the Ministry of Transport in infrastructures). According to calculations, for every euro invested, 3.5 will be added to GDP. If they manage to shape the Mediterranean Corridor, sending the batteries by train to Barcelona would reduce their costs: something that can be extended to that of Navarra and the rest of the plants.
Story of a reconciliation
It was in October when the battery factory project put on the handbrake. The reason? At that time, the Volkswagen Group had received public aid from 167 million euros (a provisional figure) that they did not consider enough. It should be remembered that Herbert Diess (former CEO of the German consortium) asked for 1,000 million.
When the Government published the final allocation of PERTE, we learned that the funds allocated to the gigafactory would be 397 million. A figure that was more than double what was initially reported and, despite this, insufficient for the Volkswagen Group. Reason why the Generalitat Valenciana took action to increase public aid with a contribution of 65.8 million earmarked for different actions that will take place in the Sagunto industrial park.
However, these figures will grow in 2023 with the extra funds that will come from the central government, as the Ministry of Industry has confirmed to Five days: an amount that will be included in the General State Budgets of 2023. Although they have not yet given specific figures, the newspaper Raise-EMV talk about 230 million euros: if true, the Volkswagen Group will have almost 700 million (693) to make Spain a European for electric mobility.
