Michigan becomes center of US battery manufacturing • TechCrunch | So Good News

Michigan, long the auto manufacturing capital of the United States, is now fueling public and private investment to build a series of battery manufacturing plants that will power the next wave of electric vehicles coming to market.

Demand for domestically produced batteries reached a peak following the passage of the Inflationary Reduction Act (IRA), which includes consumer tax incentives for the purchase of EVs with US-made battery materials. Battery makers are rushing to grab available land, setting up factories to meet that demand, ramping up their own supply chains and qualifying for the incentives outlined in the IRA.

Battery plant announcements and automaker-cell-maker joint ventures, particularly in Michigan. In Tennessee and other Southeast states, it becomes normal in 2021 and 2022. And they don’t seem to be slowing down.

Michigan got two more projects this week.

Chinese battery maker Gotion has announced a $2.36 billion investment to build a battery component plant in Big Rapids, promising 2,350 jobs. The state of Michigan is investing $1.6 billion in electric vehicle battery startup Our Next Energy (ONE), led by former leaders of Apple’s secretive car project, to build a battery plant in Van Buren Township. 200,000 EVs annually

“We are proud that Republicans and Democrats have empowered Michigan to compete for every project and every job to build our economic development toolkit,” Michigan Governor Gretchen Whitmer said in a statement about the Gotion investment. “Together This area will continue to win investment and become a prominent location for electric vehicle and mobility companies. We work with anyone and home batteries to Michigan. It will compete with everyone to keep bringing chips and electric cars.”

Earlier this week, Whitmer signed a package that includes $496 million for future economic development projects and $350 million for site development to fund Michigan’s Strategic Outreach and Attraction Reserve (SOAR). The fund, which totals $1.11 billion, is partly responsible for attracting investments from Michigan and Gotion and ONE.

Michigan vs. Texas; Georgia Kentucky South Carolina Despite competition from Illinois and Ohio over Gotion, the state said SOAR funding provided the right incentives to make the project successful, including about $175 million to support critical industry and site readiness. .

The fund was also used to provide $200 million to support ONE’s project, which promises to create 2,112 jobs by the end of 2027, when the plant should be fully operational. If ONE doesn’t create or maintain that number of jobs, the state can take that money back.

Michigan’s incentives have also attracted automakers that want to produce their own batteries locally.

Earlier this year, General Motors invested $7 billion to convert the Orion Township assembly plant into a full-size EV pickup plant and build a third battery cell plant in Lansing with LG Chem and Ultium (GM’s battery joint venture). The state provided a total of $666.1 million in funding for GM’s projects.

In June, Ford said it would invest $2 billion in three EV assembly plants in Michigan. The state lost another $100.8 million.

Break new investments.

The IRA not only stimulated domestic battery production to create new jobs and industries for the US, but also to reduce reliance on China, which dominates the supply and production of battery materials.

Gotion’s investment in Michigan follows other Chinese battery giants expanding overseas — both to continue to supply the U.S. market and to find a home for their products. CATL, for example, is building a plant in North Carolina, and SVOLT is working on its second German plant. China’s battery industry appears to be producing more batteries than domestic demand, and tapping into foreign markets is a sign that growth in China will slow. Needless to say, Gotion’s margins are underperforming; According to an analysis by “24 Waves,” a blog focused on China’s new economy.

The Chinese company’s Michigan plant will cover an estimated 260 acres and produce about 150,000 tons per year through two 550,000-square-foot production facilities, according to Michigan’s Economic Development Corporation. The project will also include the construction of two production plants dedicated to the production of 50,000 tons of anode per year.

Like Gotion, ONE aims to produce lithium iron phosphate (LFP) cells at full capacity of 20 gigawatt hours annually. Much of the US auto industry uses nickel, which is linked to many batteries, even though they have higher energy density. Cobalt The focus is on lithium ion cells that contain more expensive metals such as manganese and aluminum. LFP technology is usually cheaper and less stable, but with less range. Now, Many automakers are looking to cells, in part to ease material shortages.

Its LFP packets are nickel; ONE says it will have a comparable range to existing battery packs made with cobalt and manganese cathodes, but will be 35% cheaper. Production of the batteries for delivery truck use is scheduled to begin in March, with automotive customers to follow by the end of 2024, the company told the Wall Street Journal.

The company aims to produce a battery pack with more than 600 miles of range with cells that are 50% cheaper than today’s standard. The pack, slated for production by 2026, will feature two different chemistries: LFP technology for daily driving and anode-free cells for long trips.

Both ONE and Gotion have not disclosed which automakers they will work with once their batteries are operational, although ONE has not disclosed that it will produce a BMW iX prototype that uses some of its battery technology.