IT News on September 28th: Guoxuan High-Tech announced today that the company and its wholly-owned subsidiaries intend to sign investment agreements with Volkswagen Group and its subsidiaries to establish three joint ventures in Valencia, Spain; Súrany, Slovakia; and Kenitra, Morocco. These ventures will be dedicated to the construction of production bases for lithium batteries and lithium iron phosphate cathode materials, with a total investment of approximately 3.222 billion euros (Note from IT: At current exchange rates, this is about 24.63 billion yuan). Among them, Guoxuan's investment will total about 1.598 billion euros (about 12.216 billion yuan at current exchange rates).
Valencia joint venture constructs a lithium battery project with an annual output of 29.1 GWh, in which Guoxuan holds 49% of the shares; Sulani joint venture constructs a lithium battery project with an annual output of 8.4 GWh, in which Guoxuan holds 51% of the shares; Moroccan joint venture constructs a project for producing 100,000 tons of lithium iron phosphate cathode material annually, in which Guoxuan holds 51% of the shares.
For further reading, public information indicates that Volkswagen (China) Investment Co., Ltd. is the largest shareholder of Guoxuan High-Tech. As of September 20, 2026, it holds approximately 24.28% of Guoxuan High-Tech's shares. Volkswagen Group is an indirect controlling shareholder of Guoxuan High-Tech, hence the joint investment between Guoxuan High-Tech and Volkswagen Group this time constitutes a related-party transaction. The equity cooperation between the two parties can be traced back to 2020. In May 2020, Guoxuan High-Tech signed a 'Share Subscription Agreement' with Volkswagen China, through which Volkswagen China became the largest shareholder of Guoxuan High-Tech by participating in a private placement and acquiring shares. Both parties agreed to collaborate in the field of battery products.
The PowerCo SE that is jointly funded with Guoxuan this time is a wholly-owned battery business subsidiary of Volkswagen Group, responsible for operating Volkswagen's battery factories in Europe. The PowerCo Spain in this cooperation is its battery entity company established in Spain.
According to the announcement, the Valencia joint venture plans to invest in a lithium battery project with an annual production capacity of 29.1 GWh, with a total investment of approximately 2.262 billion euros. The joint venture will be formed by the European entity proposed to be established under Hong Kong's Guoxuan, which will increase its capital in PowerCo Spain. After the transaction is completed, PowerCo will hold 51% of the shares, and Guoxuan will hold 49%. The joint venture will then be a wholly-owned subsidiary of PowerCo. PowerCo will invest a total of approximately 1.624 billion euros in this joint venture.
In addition to equity investment, Guoxuan High-Tech's wholly-owned subsidiaries Gotion Spain Green Energy and S.L plan to sign a 'First Phase Drying Room General Contract' and a 'Second Phase Project General Contract' with PowerCo Battery Spain and S.A.U respectively for a lithium battery project with an annual output of 29.1GWh. The total amount of these contracts is 1.094 billion euros.
At the cell product level, in December 2025, Guoxuan High-Tech held a mass production delivery ceremony for standard cells (Unified Cell, abbreviated as UC) at its new station UC factory in Hefei. This marked the full entry of the five-year strategic cooperation between Volkswagen Group and its subsidiary PowerCo and Guoxuan High-Tech into the stage of large-scale mass production. From 2026 to 2032, Guoxuan High-Tech will deliver high-performance lithium iron phosphate and other standard cells to Volkswagen Group. The standard cells feature a unified size design and are compatible with various chemical systems such as lithium iron phosphate and ternary lithium, adapting to Volkswagen's MEB modular electric drive platform.
Guoxuan High-Tech was founded in 2006, with its headquarters located in Hefei, Anhui. It went public in May 2015, with the stock code SZ :002074. Its business covers the entire industrial chain, including power batteries, energy storage, and battery recycling.
This joint investment and related-party transaction has been approved at the fourth meeting of the tenth board of directors of Guoxuan High-Tech. It still needs to be submitted to the company's shareholders' meeting for review and must go through approval procedures by domestic and foreign governments, so there is a certain degree of uncertainty regarding the implementation of the project.
