Gotion takes 49% and builds Sagunto

Chinese battery maker Gotion High-tech would put roughly €1.1 billion into PowerCo's battery factory at Sagunto, near Valencia, in return for 49% of it. That would leave Volkswagen's battery subsidiary with 51% (El Confidencial, Volkswagen). A Gotion subsidiary would also win major building contracts at the same site. The public terms show where the money goes. They do not show what Gotion will earn or who will make the plant's key decisions.

Money in, money out

Gotion would buy new shares in PowerCo Spain, according to Gotion's stock-exchange filing. The money would go into the company building the plant rather than to Volkswagen (Xinhua Finance). That makes Gotion a co-owner paying into a shared project. No one is selling an existing stake and pocketing the price.

The second flow runs the other way. Gotion Spain Green Energy, a Gotion subsidiary, would take engineering and construction contracts at Sagunto worth €1.094 billion (CLS). The first phase is a €295 million package of dry rooms. These are sealed halls kept at very low humidity, because moisture damages battery cells. The second phase covers €799 million of further works, and both phases are at fixed prices (Futunn).

A fixed price means the contractor agrees the sum up front and absorbs any cost overruns. So the near match between the contracts and the investment tells readers little about Gotion's return. The contracts are revenue for specified work. Gotion's profit on them depends on what the construction actually costs, and neither company has published that.

A wider bargain across three plants

Sagunto is one of three linked ventures, and in the other two the ownership split flips. Gotion would hold 51% of a cell plant at Šurany in Slovakia and of a new factory in Kenitra, Morocco, which would make cathode material, a core ingredient of battery cells. PowerCo would take 49% of each for about €470 million by 2030 (Reuters). Volkswagen keeps the majority in the plant it already started, and Gotion gets the majority in the two it will lead. At all three sites, the published terms show who owns what, not who decides what.

What still has to be signed

None of this has closed. The ventures need regulatory approval and a vote by Gotion's shareholders. Those shareholders must also clear the construction contracts as related-party deals, meaning contracts between companies linked by ownership (Xinhua Finance). The extra vote exists because one company can end up on both sides of the same contract. Here, Gotion would part-own the client and fully own the builder.

Volkswagen describes Sagunto as jointly managed. Neither company has published the board seats, the voting thresholds, any veto rights for Gotion or any technology licence. Those documents decide who approves budgets, picks suppliers and sets the pace of expansion, whichever partner holds the larger stake.

It is also unclear how many cells Volkswagen will buy. Its European demand would get priority on the plant's output, but purchase volumes and supply guarantees are left for later agreements (Automotive World). That gap matters to Gotion as an owner, because a factory's value rests on its order book.

Spanish reporting puts Sagunto's start in 2027, with more than 1,500 direct jobs planned for the first phase (Expansión). Those are company targets for the plant as a whole. They are not jobs created by Gotion's arrival.

On the disclosed terms, Gotion would become both part-owner and main builder at Sagunto. It would pay in about €1.1 billion and line up fixed-price contracts worth almost the same (El Confidencial, CLS). The filings answer where the money goes. Two questions remain: whether Gotion makes a margin on the building work, and whether Volkswagen's 51% gives it the final word. The answers sit in two documents the companies have not released, the real cost of construction and the governance agreement.