Michigan, the longstanding auto manufacturing capital of the United States, is currently being pumped with both public and private capital to build a series of the battery manufacturing plants will drive the wave tram coming to market soon.
Demand for domestically produced batteries has reached a new peak after The Inflation Reduction Act (IRA)which include consumption tax incentives to buy electric vehicles with battery materials made in the United States. Battery manufacturers are rushing to grab available land and start production at factories to fill that demand, build their own supply chains, and qualify for incentives set out in IRAs .
Battery factory announcements and automotive battery joint ventures have become commonplace in 2021 and 2022 — particularly in Michigan, Tennessee, and other Southeast states. And they don’t seem to be slowing down.
Michigan gained two more projects this week.
Chinese battery manufacturer Gotion announces $2.36 billion invested to build a battery components manufacturing facility in Big Rapids, promising 2,350 jobs. The state of Michigan also saw a A $1.6 billion investment from Our Next Energy (ONE), one tram The battery startup, led by former leaders of Apple’s secretive automotive project, aims to build a battery factory in Van Buren Town with the aim of making enough batteries for about 200,000 EVs per year.
“I am proud that Republicans and Democrats have worked across the aisle to build our economic development toolkit and empower Michigan to compete for every project and every job.” Michigan Governor Gretchen Whitmer said in a statement about the Gotion investment. “Together, we will continue to win investments in this space and become the preeminent destination for mobility and electric vehicle companies. We will work with anyone and compete with everyone to continue bringing the battery, chip and electric vehicle supply chain home to Michigan.”
Earlier this week, Whitmer signed a package that includes additional investment — $496 million for future economic development projects and $350 million for site development across the state — for the Reserve. Michigan’s Strategic Attraction and Access (SOAR). The fund, totaling $1.11 billion, is partly responsible for helping Michigan attract investment from Gotion and ONE.
Michigan is clearly competing with Texas, Georgia, Kentucky, South Carolina, Illinois, and Ohio for Gotion, but the SOAR fund has helped provide the right incentives to win the business, including about $175 million to fund supporting key industries and location readiness, the state said.
The fund was also used to approve a $200 million grant to support ONE’s project that promises to create 2,112 jobs by the end of 2027, when the plant will be fully operational. That money can be taken back by the state if ONE does NOT create or maintain those jobs.
Michigan’s incentives have attracted automakers who want to produce their own batteries in the country.
At the beginning of the year, General Motors invests 7 billion dollars converted the Orion Township assembly plant into a full-size EV pickup factory and built Ultium’s (GM’s battery joint venture with LG Chem) third battery factory in Lansing. The state has included a total of $666.1 million in support for GM’s the projects.
In June, Ford says it will invest $2 billion in three electric vehicle assembly plants in Michigan. State took in another $100.8 million.
Split new investments
The IRA not only encourages domestic battery production to create new jobs and industries for the United States, but also to reduce dependence on Chinacapital is the absolute dominant force in the supply and production of battery materials.
Gotion’s investment in Michigan follows a string of other Chinese battery giants expanding overseas – both to continue supplying the US market and to find a home for their products. CATL, for example, is building a factory in North Carolinaand SVOLT is working on the second factory in Germany. The Chinese battery industry appears to be producing more batteries than it needs domestically, so tapping overseas markets could be a sign that growth in China will slow. Not to mention, Gotion’s profits have been underperforming, according to one analysis of “24 Waves”, a blog focused on China’s new economy.
The Chinese company’s Michigan plant will cover an estimated 260 acres and will produce about 150,000 tons of cathode material per year through two 550,000-square-foot manufacturing plants, according to the company. Michigan Economic Development Corporation. The project will also include the construction of two manufacturing plants dedicated to producing 50,000 tons of anode material per year.
Like Gotion, ONE intends to produce lithium iron phosphate (LFP) cells at a maximum capacity of 20 gigawatt hours per year. Most of the U.S. auto industry is focused on lithium ion cells that contain more expensive metals such as nickel, cobalt, manganese and aluminum, which have higher energy densities and a wider operating range but have a higher power density. involved in many battery fires. LFP technology is generally cheaper and less volatile, but has less dynamic range. The current, Many automakers are exploring partial cells to alleviate material shortages.
ONE says its LFP packs will have the same range as current battery packs made with nickel, cobalt and manganese cathode but will cost 35% less. Producing batteries for delivery truck Usage is expected to begin in March, followed by automotive customers by the end of 2024, the company says. The Wall Street Journal.
The company is also aiming for production battery pack with a range of more than 600 miles with cells up to 50% cheaper by today’s standards. That package, scheduled for production in 2026, will include two chemicals: LFP technology for everyday driving and cells without anodes for longer range trips.
Neither ONE nor Gotion have revealed which automakers they will work with once their batteries are up and running, although ONE has partnered with BMW car arrive produce a prototype BMW iX uses some of its battery technology.