Minister of Economy praises Portugal being chosen to manufacture new Volkswagen electric vehicle

Volkswagen Autoeuropa was the plant chosen to manufacture the new Volkswagen electric vehicle, the ID.EVERY1, an investment that places Portugal at the forefront of the sector energy transition in Europe. "This is a truly historical day for Portugal and a happy one for all of us", praised the Minister of Economy, Pedro Reis.

The Minister claimed that "in one sitting, the Portuguese economy achieves the guarantee of producing a new electric vehicle, which ensures the future of the factory in Setúbal – a cutting-edge Volkswagen plant, as well as a huge value chain of national supplier for many years".

"It is with great enthusiasm that we take on the production of the ID. EVERY1, a model that will make electric mobility more accessible and sustainable in Europe. This achievement is a milestone for Volkswagen Autoeuropa, signalling our entry into the electrification age. We wish the thank the support of the Portuguese Government, which has given us the best conditions to attract this new project to the country", said Thomas Hegel Gunther, Volkswagen Autoeuropa CEO.

The Palmela factory takes on a decisive role in the Portuguese economy. With a turnover of around 3.8 billion euros and 4 842 workers, Volkswagen Autoeuropa produced 236 100 cars last year, accountable for 4% of national exports and 1.3% of GDP in 2023.

Now, with this new investment, it will also lead the sector’s energy transition, a necessary one, and staking its claim as a factory of the future. In addition to producing the new car model, the decision includes a new generation electrified factory and the adoption of new production and logistics processes, as well as robotic mounting of robotics systems.

The Palmela factory will become more efficient and capable of competing with global manufacturers, aligning the company and Portugal with the European carbon neutrality climate goals in a setting where the European Union is limiting the production of combustion and hybrid vehicles.

Together with this investment programme of around several hundred millions, this decision also brings the potential of attracting new suppliers to Portugal and the automobile cluster, namely in terms of electric vehicles.

In a context of the automobile sector undergoing transformation on a European and global scale, this is another investment that shows the excellence of the Portuguese economy and its value proposal, capable of attracting innovation and investor confidence.

This result was only possible due to the intense and fully coordinated work between the Ministry of Economy and AICEP on the one hand, and Volkswagen Autoeuropa and the parent company on the other.

"With this decision by Volkswagen, the Portuguese economy is taking a giant leap towards contributing to the European green re-industrialisation and the reinvention of the European automobile sector" Pedro Reis further highlighted.

Volkswagen’s investment follows on from Calb’s choice and the contracting of 420 million euros through the Portuguese Foreign Trade and Investment Agency (AICEP) in 2024.