Volkswagen's (VWAGY.US) battery division lists IPO conditions, earliest listing by 2026.

Thomas Schmall, head of the Volkswagen battery division, stated that the department will not consider going public until the factory is operational and standardized battery units are in use, effectively ruling out the possibility of an IPO before 2026. Schmall's remarks provide the strongest indication to date that the largest car manufacturer in Europe may introduce external investors or establish strategic partnerships with other battery manufacturers and list its PowerCo battery business on the stock exchange. Schmall said, "The next step, an IPO, is still an option for the future. However, it will only become a question when the factory is up and running, and standard units are in use." Volkswagen split its battery division in mid-2022, investing 20 billion euros (217 billion USD) with partners to build factories with a capacity of 240 GWh by 2030, with the hope of strengthening control over the supply chain and catching up with Tesla. The department aims to achieve 20 billion euros in sales by the end of this decade, and has announced the opening of three battery factories in Salzgitter, Valencia, and Ontario in 2025, 2026, and 2027 respectively. The company plans to use its standardized battery on at least 80% of its electric vehicles starting from 2025, which is a single battery design with three different chemical compositions, making 2026 the earliest time to meet the conditions for listing as proposed by Schmall. So far, PowerCo has not disclosed a specific time for a potential IPO, only stating that they plan to prepare for commercial investors starting in 2024. Schmall also ruled out the possibility of building another factory in Europe at this time. He said, "From a competitive and cost perspective, there is currently no discussion on this." With sales growth slowing down and financial losses accumulating, the enthusiasm from the capital markets for electric vehicles has cooled, making it difficult for smaller companies like Polestar and Fisker to raise funds for electric vehicle development. Due to high borrowing rates hindering investors, the activity in the IPO market last year dropped to its lowest level since 2016. Andy Leyland, founder of battery supply chain consulting firm SC Insights, said, "Market sentiment is very low." Chris Burns, CEO of anode material supplier Novonix, stated: "Public market investors want to see cash flow. Battery manufacturers need to sign purchase agreements early and build strong partnerships with car manufacturers to gain trust from the start."