By Victoria Waldersee and Christina Amann

WOLFSBURG, Germany (Reuters) – Volkswagen (ETR:) is not going to contemplate a inventory market itemizing for its battery unit till its factories are up and operating and its unified battery cell is in use, the division’s boss informed Reuters, primarily ruling out a doable IPO earlier than 2026.

Thomas Schmall’s feedback present one of the best indication thus far for when Europe’s high carmaker could float its PowerCo battery enterprise on the inventory alternate, as a follow-up to bringing in an outdoor investor or getting into strategic partnerships with different cell producers.

“In a second step, an IPO stays an possibility for the longer term. Nonetheless, this may solely turn out to be a difficulty as soon as the factories are up and operating and the standardised cell is in use,” he informed Reuters.

Volkswagen cut up off its battery unit in mid-2022, investing 20 billion euros ($21.7 billion) with companions to construct crops reaching 240 gigawatt hours of capability by 2030 in a transfer it hoped would give it higher management of its provide chain and assist it meet up with Tesla (NASDAQ:).

The unit, aiming for 20 billion euros in gross sales by the tip of the last decade, has thus far introduced three battery cell factories in Salzgitter, Valencia and Ontario to open in 2025, 2026 and 2027, respectively.

It plans to make use of its unified cell, a single cell design obtainable in three totally different chemistries, throughout at the least 80% of its electrical automobiles from 2025 – making 2026 the earliest time when Schmall’s circumstances for a list can be met.

PowerCo has thus far shied away from being particular concerning the timing of a possible IPO, solely saying it deliberate to have the enterprise investor-ready from 2024.

Schmall, for the primary time, additionally dominated out one other plant in Europe for now.

“In the intervening time this isn’t on the desk from each a aggressive and price perspective,” he mentioned.

Capital-market enthusiasm for EVs has cooled as gross sales progress slowed and monetary losses have piled up, with smaller corporations from Polestar (NASDAQ:) to Fisker (NYSE:) struggling to amass the funds for EV improvement.

The IPO market final yr noticed its lowest degree of exercise since 2016 as excessive borrowing charges held buyers again.

“Public market buyers wish to see money circulation,” mentioned Chris Burns, CEO of anode materials provider Novonix.

Battery cell makers wanted early offtake agreements and powerful partnerships with carmakers to realize belief from the start, he added.

“The sentiment could be very poor… it is simply not an excellent time,” mentioned Andy Leyland, founding father of battery provide chain consultancy SC Insights.

($1 = 0.9211 euros)