Porsche considers acquiring a stake in Varta battery subsidiary V4Drive

Porsche is considering acquiring a majority stake in the electric car battery business of ailing battery manufacturer Varta. Both sides are currently negotiating about V4Drive, Varta's subsidiary for electric car batteries.

Varta has officially announced that it is examining a possible majority investment in its subsidiary V4Drive, which was founded in 2022, with Porsche. Both parties have signed a non-binding letter of intent. According to Varta, V4Drive will initially be outsourced before Porsche buys in via a capital increase. However, the deal has not yet been finalised. The transaction is said to depend on various factors and Porsche first wants to take a close look at the balance sheets.

Varta presented the first V4Drive cell suitable for electric cars in the 21700 format (2.1 cm diameter, 7 cm height) in 2021. In April of that year, the company initially presented it as the basis for a battery that would serve as a “booster” in premium and sports vehicles or as a storage unit for recuperation energy in hybrid vehicles. Just a few months later, Varta then announced “larger lithium-ion round cells” that would go beyond the 21700 format and would also be suitable as a stand-alone traction battery. Varta’s CEO at the time, Herbert Schein, was convinced “that our round cell formats represent excellent alternatives for the construction of battery electric vehicles in the performance sector due to their unique properties.”

Varta wanted to push ahead with commercialisation quickly: Pilot production of V4Drive cells in the 21700 format was announced at the time for the end of 2021, with mass production scheduled to begin two years later at the end of 2023 – and production capacity of at least 2 GWh. According to a statement from Schein at the time, customer demand would determine the extent to which the company would subsequently enter into the production of V4Drive cells. Interestingly, an order from Porsche from June 2021 had already been placed at the time.

The Zuffenhausen-based company has therefore been interested for a long time. However, Varta put its plans in the automotive sector on hold at the end of 2022. The new factory construction for the V4Drive battery was only to be continued after binding customer commitments, it was said at the time. There was therefore apparently a lack of interested parties for the performance cells. However, the operation of the pilot plant continued as planned. In August 2023, rumours again flared up that Varta was continuing to work on the series production of battery cells for electric cars. This was indicated by a purchase agreement for anode copper foil with a Korean supplier.

Meanwhile, Porsche has long indicated that it wants to produce its own battery cells. Around three years ago, Porsche founded a battery subsidiary called Cellforce – initially with Customcells as a partner, but Porsche has since taken over completely. Cellforce is currently building a pilot plant near Reutlingen with a production capacity of up to 1.3 gigawatt-hours. In addition to the factory currently under construction near Reutlingen, the company is looking into a potential expansion to over 20 gigawatt-hours at a second site in 2023. A few weeks ago, however, Tagesspiegel Background reported that Porsche could not currently bring itself to build a large battery cell factory.

Porsche had confirmed plans for such a battery factory as recently as mid-2023, when North America was initially considered the favourite. However, Porsche was later rumoured to be interested in an area in Brandenburg, specifically a site on the grounds of the Schwarzheide/Schipkau airfield in the district of Oberspreewald-Lausitz. According to Automobilwoche, investments of two to three billion euros would be required for 20 gigawatt-hours. Porsche apparently does not want to manage this alone but is looking for partners. The sports car manufacturer also wants to work together with Volkswagen’s battery sister company PowerCo.

automobilwoche.dewiwo.de (both in German)

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