Niedersachsen Attracts Significant Investments from the Automotive and Logistics Industries

December 2019

Volkswagen AG and Northvolt AB have created a 50/50 joint venture to build a factory for lithium-ion batteries

The construction of the production facility is scheduled to start in Salzgitter (Niedersachsen) in 2020, and the facility is expected to be operational by the end of 2023/beginning of 2024. The initial annual output is to be 16 GWh. The details of the joint venture were finalised in an agreement which both parties concluded in June 2019. Part of the approximately € 900 million invested by Volkswagen is now flowing into the joint venture.

Dr Stefan Sommer, member of the Volkswagen AG Board of Management responsible for procurement and member of the Supervisory Board of Northvolt AB, commented: “The battery cell is the key component for electric mobility. Volkswagen and Northvolt are together advancing efficient cell production in Europe to accelerate their joint battery activities. With the joint venture and the planned construction of a battery cell factory in Salzgitter, we are making a decisive contribution to establishing the core battery cell technology in Germany as well.”

Fredrik Hedlund, Chief Executive Officer of the new joint venture and former Chief Strategy Officer of Northvolt, said: “Building a gigafactory in Germany together with Volkswagen allows Northvolt to further increase the production capacity of green battery cells with a minimal CO2 footprint. This will have a significant impact on electrification in Europe.”

Groundbreaking ceremony for the Smyths Toys logistics facility  © Deltaland Wirtschaftsförderung

Kasai Kogyo takes over the Röchling plant in Wolfsburg

The second investment in the automotive sector was the acquisition of the Röchling plant in Wolfsburg-Hattorf by the Japanese automotive supplier and component manufacturer Kasai Kogyo Co., Ltd. While Röchling is concentrating on its core business with the sale, Kasai Kogyo is continuing its global growth trajectory in Europe.

The 13,000 m2 plant in Wolfsburg-Hattorf, which was built in 2001, produces car door and side panels. The sale of the plant will affect about 170 employees. Kasai Kogyo is taking over all business operations and thus all employees, hence no job losses are anticipated. Both companies hope that the transaction will ensure the continuity and quality of the plant. Kasai Kogyo has already announced its intention to invest in the location and the existing business.

Topping-out ceremony for the Coca-Cola logistics facility  © Deltaland Wirtschaftsförderung

Heidekreis: A magnet for logistics businesses

Heidekreis offers a particularly attractive environment for logistics businesses and is welcoming three major new facilities.

First, there’s Smyths Toys:  with its new establishment, Europe’s largest toys trading company, headquartered in Ireland, is creating additional capacity for business in the DACH region. The real estate agent bauwo Grundstücksgesellschaft mbH, which is based in Hannover, and Smyths Toys (formerly Toys“R”Us) have signed a contract for the rental of a logistics facility in the Walsrode A27park. A 50,000 m2 logistics facility, to include an office wing, is to be constructed to supply goods to the brick-and-mortar shops of the Smyths Toys Superstores Group in Germany, Austria and Switzerland. The investment volume is in the region of € 40 million. In the final expansion stage, Smyths Toys plans to create some 350 new jobs at the Walsrode logistics facility.

Likewise, the furniture discounter Poco is about to set up a new logistics centre. To this end, the company has acquired a plot of about 9.8 hectares, with the option to buy an additional 9 hectares in Bomlitz-Benefeld. In the first two construction phases, three logistics halls of around 44,000 m2 in total will be built. The company is undertaking the project as both the investor and owner. The Poco Domäne Holding is part of the Austrian furniture chain XXXLutz and currently employs around 8,000 employees in its 125 furniture stores across Germany.

A further new facility in Heidekreis has materialised in record time. In January of this year, Coca-Cola approached bauwo to enquire about establishing a new logistics facility. A mere four months later, the diggers rolled in to start the ground work. The completed facility of 26,000 m2 will be ready for handover to Coca-Cola as soon as December 2019. The town of Bad Fallingbostel and Heidekreis played a significant part in implementing the project so speedily. The local authority has proven once again that it is perfectly possible to process and approve a construction project of this dimension within a mere four weeks.

Niedersachsen is the perfect location for businesses who want to see their investments spring to life with speed and efficiency!