VW to build $2 billion Scout assembly plant in S.C.

Another part of Scout Motors Inc.’s launch plan came into focus as Volkswagen Group announced it will build a $2 billion assembly plant in Blythewood, S.C., near Columbia, to manufacture battery-electric SUVs and pickups beginning in 2026, bringing with it an estimated 4,000 jobs.

The German automaker’s board had also been expected to announce the details of a battery plant it has committed to build in Canada, but a spokesman said that any decision would not be announced Friday.

Both announcements were anticipated given the automaker’s previously disclosed plans, though the exact locations of the new factories were unknown. The Scout plant, with an annual capacity of over 200,000, will manufacture vehicles exclusively for that brand and not for other group brands such as Volkswagen or Audi, a VW Group of America spokesman told Automotive News.

In a LinkedIn post Friday, Scout Motors CEO Scott Keogh wrote: “This moment is so important not only for Scout Motors, but also for America. After 3 years of supply chain disruptions and unpredictability in manufacturing, this is the moment American ingenuity is being put back into action. As a benefactor of this moment, Scout is proud to join the push to revitalize manufacturing in America.”

Scout was created by VW Group’s board in 2022 under the leadership of then-CEO Herbert Diess. The brand is only now building up its management teams under Keogh, the former CEO of VW of America.

Scout vehicles will ride on a new  electric platform designed in Germany, VW said when the brand was announced. Keogh phoned South Carolina Gov. Henry McMaster on Friday morning to congratulate him, according to the Republican governor’s Twitter account, which shared a video of the call. Blythewood is a town of approximately 4,800 residents about 19 miles north of Columbia along Interstate 77.

The German automaker has taken great pains to keep Scout Motors a separate entity from its existing VW Group of America corporate structure. If the two entities were linked, it might provide VW and Audi dealers a claim that Scout vehicles should be retailed at their dealerships. Thus far, however, Keogh and Scout Motors have not said how the brand’s vehicles will be sold in the U.S.

As for the Canadian battery plant, VW officials had predicted it would have a large impact on the automaker’s operations in one of its largest markets. The automaker signed a deal with Canadian government officials on Aug. 23 to collaborate on opportunities throughout the electric vehicle value chain and to establish an office in Canada for its in-house battery unit, PowerCo.

At the time, company executives said its Canada plans were to span the early links in the EV battery supply chain, namely mining, processing, cathode active material production and battery cell manufacturing. By putting battery production as well as assembly in North America, VW Group hopes to comply with the provisions of the U.S. Inflation Reduction Act passed last year, helping its vehicles qualify for federal tax incentives.

VW currently assembles its ID4 electric compact crossover at its complex in Chattanooga, and it receives its batteries from an SK Innovation plant in nearby Georgia. However, the company has long-term plans to vertically integrate almost all of its battery manufacturing globally through PowerCo.

Other EVs are eventually expected to be built in Chattanooga, including a planned Atlas-sized crossover several years from now. VW also operates a large assembly plant in Puebla, Mexico, as well as an Audi plant in San Jose Chiapa, Mexico, but those plants currently manufacture only internal combustion vehicles. Audi executives have separately told Automotive News that the premium brand also needs an EV assembly plant in North America.