Volkswagen and Gotion High-Tech Vie for Control of Spanish Battery Plant
Miles Bennett
Volkswagen and battery partner Gotion High-Tech (国轩高科) are deadlocked over control of the Sagunto plant in Spain — Gotion wants a majority stake and operational control, and VW refuses to yield. This means → in the lithium-battery era, automakers' traditional grip on key components is being challenged from the supplier side.
Why can't the two sides close a deal?
The Sagunto plant is the centrepiece of VW's €3 billion battery investment. Gotion is both co-investor and technology provider.
Gotion wants a majority stake plus operational control. VW has so far refused to hand over the reins — the deadlock is over who runs the factory.
Pre-production was scheduled for September 2026 but has slipped to December. Full-scale production is now expected no earlier than summer 2027.
Why does Gotion insist on control?
First reason: a wider European footprint. With operational control, Gotion could supply carmakers beyond VW and fold battery recycling into an EU-compliant closed-loop system — production to recycling, all on European soil.
Second reason: protecting core technology. Gotion fears its proprietary battery know-how could migrate to PowerCo, VW's in-house battery unit. Running the plant keeps that IP risk to a minimum.
This reflects a structural reality: VW holds 24.29% of Gotion — the single largest stake — yet the remaining shareholders collectively own more than three-quarters. Gotion's management must show *all* shareholders that this partnership maximises returns, not just serves VW.
How has lithium changed the automaker-supplier relationship?
Under the traditional model, carmakers held strong bargaining power over component suppliers through tight contracts. Once a technology matured, production could be outsourced to any qualified manufacturer.
In plain terms = carmakers used to be the buyer who set the terms; suppliers competed for the contract. Batteries are different — advanced technology and large-scale capacity are concentrated in a handful of firms, turning the supplier into the scarce resource.
Europe and North America have failed to build independent battery supply chains. This means → companies like Gotion, which control both the technology and the manufacturing capacity, hold far more leverage than a traditional parts supplier ever did.
Is there a precedent to look at?
The 2021 LG Chem case: LG agreed to cover most of General Motors' battery-recall costs, offsetting roughly $1.9 billion of GM's approximately $2 billion recall bill — at the time widely seen as proof that carmakers could hold battery suppliers to account.
This means → the VW–Gotion standoff signals that the balance of power from that era is reversing: suppliers are no longer simply accepting the automaker's terms.
How the Sagunto control fight ends will be a critical test case for whether European carmakers can hold on to supply-chain dominance in the battery age.
Content is for reference only, not financial advice.