Shanghai (ZXZC)- Volkswagen's battery partner Gotion High-Tech announced it signed on March 22 an agreement with local government of Feidong County, Hefei for a project related to power battery industrial chain as the company wishes to strengthen its competency in power battery industry.

Gotion High-Tech, Feidong County sigining agreement; photo credit: Gotion High-Tech

Under the agreement, Gotion High-Tech plans to pour a total of 12 billion yuan ($1.844 billion) in the construction of facilities for recycling of batteries and production of upstream raw materials of lithium batteries in Feidong County. The whole project should be completed within 24 months after the construction starts. 

The Hefei-based battery manufacturer said this investment is aimed at improving its strategic deployment about the recycling of batteries and the manufacture of upstream raw materials of lithium batteries, further reinforcing the control of product cost, and entrenching its market standing in the lithium battery industry. It is also conducive to improving the company's core competence and industrial influence, and is in line with the battery maker's long-term development strategy and interests.

With the expansion of battery capacity, Gotion High-Tech endeavors to build up a full-fledged lithium power battery industrial chain. The company claimed earlier this month it founded two wholly-owned subsidiaries with its own funds. Specifically, Hefei Gotion Recycling Technology Co.,Ltd is dedicated to recycling and reuse of batteries, Hefei Gotion New Material Technology Co.,Ltd. will engage in the R&D, production and sale of anode materials. Both of them involve registered capital of 50 million yuan ($7.683 million).