Gotion and Volkswagen Approve Their Industrial Project in Kenitra

Shareholders Approve Gotion High-Tech and Volkswagen Investment Agreement

On October 20, 2026, shareholders of the Chinese battery manufacturer Gotion High-Tech approved an investment agreement with Volkswagen and its subsidiary PowerCo, marking a new phase in the construction project of a battery materials factory in Kenitra. Valued at €480 million, approximately MAD 5.19 billion, the facility is expected to have an annual capacity of 100,000 tons of lithium iron phosphate (LFP) cathode active materials, primarily intended for the European industrial sites of the partnership.

Kenitra at the Heart of the Gotion and Volkswagen Partnership

During an extraordinary general meeting in Hefei, China, Gotion High-Tech shareholders endorsed the resolution regarding joint investments with Volkswagen and PowerCo. According to the official minutes referenced 2026-078, which were released following the vote, the resolution secured 93.14% of the votes cast, against 4.20% in opposition and 2.66% abstentions.

Volkswagen China, the largest shareholder of Gotion High-Tech, refrained from voting on this resolution due to its related-party status. Its voting rights were excluded from the total count. The proposal, requiring a two-thirds qualified majority, was thus approved.

This endorsement is a significant advancement for the Moroccan project announced at the end of September. However, it does not mean that all investments have been finalized, as several regulatory approvals and contractual conditions still need to be satisfied.

A LFP Battery Material Factory

The project involves establishing a joint venture in Kenitra, with Gotion Power Africa S.A.S. holding a 51% stake and Power Holdco Lux S.A., a Luxembourg subsidiary of PowerCo, holding 49%. The factory will produce cathode active materials for lithium iron phosphate batteries.

With an announced annual capacity of 100,000 tons, the Moroccan site will supply materials for battery cell manufacturing units planned in Slovakia and Spain. The partners aim to create an integrated industrial supply chain, from the production of cathode materials to the manufacturing of cells intended for the European market.

The total construction duration is expected to reach five years. However, the actual timeline will depend on the progress of the works, necessary permits, and the conditions for implementing the partnership. Available documents also specify that the announced investment for Kenitra does not include land or factory buildings.

A Moroccan Company Established to Manage the Investment

The industrial setup relies on Gotion Power Africa S.A.S., formed in Rabat on August 3, 2026, with a share capital of 10,000 dirhams. This simplified joint-stock company is wholly owned by Gotion GmbH, the German subsidiary of the Chinese group based in Hanover.

Its role includes managing the group’s investments in Morocco and establishing the joint venture that will incorporate PowerCo, which will enter the share capital through Power Holdco Lux. At the time of the initial announcement, the future joint venture had not yet acquired a definitive company name.

The capital distribution ensures a Chinese majority of 51% and a 49% stake for PowerCo. According to the governance structure outlined in the documents, the CEO, who will also serve as CFO, will be appointed by the majority shareholder. Gotion will thus play a central role in managing the future Moroccan entity.

Three Industrial Sites for a €3.22 Billion Investment

The partnership between Gotion and PowerCo encompasses three industrial projects in Morocco, Slovakia, and Spain. The total announced investment amounts to €3.22 billion, roughly MAD 34.85 billion, with Gotion contributing €1.60 billion and PowerCo entities contributing €1.62 billion.

In Kenitra, the project represents a €480 million investment for an annual capacity of 100,000 tons of LFP cathode active materials. The joint venture will be owned 51% by Gotion and 49% by PowerCo.

In Slovakia, the Šurany site will produce lithium-ion cells with an announced capacity of 8.4 GWh per year. The expected investment is also €480 million, maintaining the same capital distribution: 51% for Gotion and 49% for PowerCo.

In Spain, the Valencia project plans for an annual capacity of 29.1 GWh of lithium-ion cells, with an investment of €2.26 billion. The capital structure will be reversed, with PowerCo holding 51% of the joint venture compared to Gotion’s 49%.

The financing will come from the equity of the involved companies and funds obtained from financiers. Disbursements will be staggered, and the final costs may differ from initial estimates.

The €480 Million for Kenitra Does Not Equate to PowerCo’s Contribution

It is crucial to distinguish between the total cost of the Moroccan project and Volkswagen’s direct financial contribution. In its statement dated September 28, the German automaker announced that PowerCo would provide approximately €470 million to the Moroccan and Slovak entities combined by 2030, in exchange for 49% of the capital of each.

This allocation covers both countries and does not represent PowerCo’s exclusive contribution to the Kenitra factory. The €480 million allocated for Morocco pertains to the total projected cost of the project, inclusive of all contributions.

The exact distribution of direct contributions from each partner to the financing of the Moroccan site is yet to be established. Thus, the announced amounts should be interpreted with respect to their respective scope to avoid confusion between total investment and shareholder contribution.

Production Primarily for European Factories

The industrial strategy envisions complementarity among the three sites. The Valencia and Šurany plants are to manufacture cells primarily for Volkswagen’s European needs, while the Moroccan site will supply the necessary cathode materials for their production.

Chinese documents indicate that materials produced by the Moroccan joint venture will be prioritized for the two other joint ventures. This organization aims to secure a portion of industrial supplies and strengthen the links between different stages of the battery production chain.

However, several details remain to be clarified. Contractual volumes, commitments for raw material supplies, compensation mechanisms in case of shortages, and local purchase modalities will require subsequent agreements. At this stage, the announcement does not allow us to conclude that all 100,000 tons of annual capacity already has firm orders.

Shareholders Also Approve Spanish Contracts

The extraordinary general meeting of Gotion High-Tech also validated a second resolution concerning two construction contracts in Spain, totaling €1.09 billion, or approximately MAD 11.83 billion. This proposal received 97.17% support, against 0.18% dissenting votes and 2.65% abstentions. Volkswagen China did not participate in this vote.

The contracts pertain to the Sagunto site near Valencia. The first involves the design and construction of clean and dry rooms for the first phase of production, amounting to €295 million, with a projected duration of 472 days from the commencement of work. The second, valued at €799 million, concerns the works and equipment for the second phase, with an expected duration of 1,181 days.

These services are to be executed by Gotion Spain Green Energy S.L. for PowerCo Battery Spain S.A.U., and both contracts are fixed-price agreements. Their amounts reflect construction and equipment work and should not be mechanically added to the €3.22 billion of industrial investment announced for the partnership.

The file also mentions €152 million in public aid from Spain already granted to the Valencia project prior to the partnership. Volkswagen guarantees potential reimbursement of this subsidy, with a compensation mechanism set at 49% of amounts the manufacturer may have to pay. This provision exclusively concerns the Spanish project and does not constitute public assistance granted for the Kenitra site.

An Investment Still Subject to Several Conditions

The industrial agreement remains subject to multiple suspensive conditions, including obtaining and maintaining regulatory approvals, the absence of legal prohibitions, and the completion of formalities related to the creation of joint ventures and certain asset transfers.

The vote on October 20, therefore, represents a major step in validating the partnership, but it does not equate to the final closure of all investments. The documents also outline potential termination options in cases of missing approvals, serious breaches, or surpassing a contractual deadline, which has not been specified in the public notice.

For Morocco, the Kenitra project represents a perspective for industrial development within the electric battery value chain. Its realization will now depend on the completion of procedures, the timing of works, and the establishment of industrial and commercial commitments among the partners.