VW's SEAT says Spain needs a battery plant as it eyes EV production

BARCELONA (Reuters) - Volkswagen’s Spanish unit SEAT called on the Spanish government on Monday to promote local battery production for electric cars, which the automaker could potentially start manufacturing in Spain in 2025.

SEAT is in “advanced conversations” with the government on whether to start producing a small electric vehicle at its Barcelona-area plant, Chairman Wayne Griffiths told a news briefing, adding that an announcement should be expected in the coming weeks.

After deeming it “essential” to have a battery factory in Spain, Griffiths also said it would help if batteries were assembled close to the Martorell plant near Barcelona.

Reuters reported last week that Spain is considering converting Nissan’s main car plant in Barcelona, which is due to close in December, into a battery production facility for electric cars.

“The Spanish government cannot miss the train of electrification,” Griffiths said, stressing that Spain, as Europe’s second-largest car manufacturer, needs to take the lead in promoting production, demand and charging infrastructure for electric cars.

He said Spain’s 140 billion euro ($169.89 billion) share of the EU’s COVID-19 pandemic aid should also be used for that goal, arguing it would create new jobs in the country with one of Western Europe’s highest unemployment rates.

Along with other significant Spanish companies, SEAT has expressed interest in receiving EU funds to promote the auto sector’s electric transformation, a SEAT spokesman said.

Regarding the industry’s global supply shortage of semiconductor chips, Griffiths said SEAT would lose some production volume in the first half of the year which will need to be recovered in the second half.

But he expected a “much better year” than 2020, forecasting a strong second half in sales - including for its associated brand CUPRA - once the pandemic eases.

($1 = 0.8241 euros)

Reporting by Joan Faus, editing by Andrei Khalip and Jason Neely