William Malcolm

Govt In Talks With Volkswagen About Building Czech Battery Factory

The Czech government is negotiating with the German carmaker Volkswagen that the company would build one of its planned factories to produce batteries for electric cars in the Czech Republic. Minister of Industry and Trade Karel Havlíček told Hospodářské noviny (HN). According to him, the Volkswagen plant negotiations are tied to the previously announced project of the ČEZ energy group, which recently published considerations on the construction of a battery factory in northern Bohemia.

Volkswagen, which includes the Czech carmaker Škoda Auto, announced on Monday that it plans to have six battery factories in Europe by 2030. He stated that one could be in the Czech Republic.

“We are talking about it intensively. It is linked to the ČEZ Gigafactory project, which I consider one of the priorities and an essential investment in the years to come. We must not miss this opportunity. We want to make a decision this year. ČEZ regularly informs us, and people or I from the Ministry of Industry team are in negotiations with potential critical investors in the emerging consortium, “said HN Havlíček.

Last year, the minister announced that CEZ Group was considering building a lithium battery plant for cars in northern Bohemia in the next few years, which he described as the Gigafactory project.

Together with investors from the automotive industry, the company wants to use lithium from the Cínovec area in the Ore Mountains to manufacture batteries. “A partnership with a local manufacturer such as Škoda would be natural, but we cannot comment on such negotiations now,” said Pavel Cyrani, CEZ’s Vice Chairman of the Board of Directors.

Havlíček told the daily that the Czechia could provide direct support and tax benefits for the Volkswagen factory. Petr Knap, a partner of the consulting company EY for the automotive industry, has previously stated that when considering these investments, in addition to tax incentives, labor costs, and their qualifications, the investor will also look to the state’s support for electromobility. “And here in our country (in the Czech Republic), he will find a very below-average to negligible scale in the EU,” he said.