Volkswagen Group is giving consideration to building an $11 billion plant that would be used to produce battery cells for its electrified vehicles.

Citing company sources, Germany’s dpa news agency reports that the plant would potentially be located in Salzgitter, about 33 miles south of Volkswagen’s headquarters in Wolfsburg. The proposed facility would rival Tesla’s Gigafactory, a sprawling lithium-ion battery production plant under construction in Nevada.

Volkswagen estimates that it will need to sell 1 million battery-powered or plug-in hybrid vehicles by 2025 in order to meet CO2 emissions requirements in Europe and China.

To help fulfill these mandates, the company intends to add 20 new electrified cars to its lineup by 2020, including the Porsche Mission E electric car and the Audi e-tron quattro. At the moment, Volkswagen produces the VW e-Golf and e-Up and the Audi R8 e-tron electric cars and hybrid versions of the VW Golf and Passat, the Audi A3 and Q7 and the Porsche Cayenne and Panamera.

Volkswagen has previously announced its forthcoming MEB platform, a modular architecture that is scheduled to reach production by 2019. The new platform is believed to provide increased flexibility that will allow battery packs to be scaled to meet the needs of a range of vehicles.