Yesterday’s surprise resignation of Stellantis CEO Carlos Tavares evidently hasn’t slowed the company’s electric-vehicle aspirations, as word comes today that the U.S. Energy Department has committed over US$7 billion to a joint venture between the company and Samsung SDI.
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The $7.54-billion loan is earmarked to build two electric vehicle battery plants in Komoko, Indiana under the StarPlus Energy LLC banner, with at least 2,800 jobs at the factories themselves, and hundreds of spin-off jobs. Conditions of the loan include StarPlus presenting a plan to work with community and labour leaders to create good-paying jobs, in addition to meeting technical, legal, environmental, and financial conditions. If finalized, Stellantis would get $6.85 billion in principal, plus $688 million in interest for the project.
If approved, the two plants will produce battery cells and modules for electric vehicles to be sold in North America, and at full capacity will manufacture batteries to supply more than 650,000 electric vehicles per year.
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“This will greatly expand EV battery manufacturing capacity in North America and reduce America’s reliance on adversarial foreign nations like China,” the U.S. Energy Department said in a statement.
What is unclear is whether the loan agreement can be signed before President-elect Donald Trump takes office on January 20. On the campaign trail, Trump vowed to stop such loans for the electric-vehicle industry. This news also comes on the heels of Rivian Automotive receiving a $6.6-billion loan last month to build a factory in Georgia.
In other battery factory news south of the border, General Motors announced it is selling its stake in a battery factory in Lansing, Michigan to LG Energy Solutions.
According to media reports, GM has spent nearly $1 billion on the joint venture with its South Korean partner LG, but is cutting ties with the nearly completed facility. In a statement, GM said it will source its EV batteries from joint venture factories in Warren, Ohio; and Spring Hill, Tennessee.
The company also said it has reached an agreement with LG to jointly develop prismatic battery cells, an emerging technology that features rectangular cells that can store more energy, thus reducing the size and weight of a battery pack and cutting costs when compared to the pouch cells GM currently uses.
Through September of this year, new EV sales in the United States were up 7.2%, or 936,000 vehicles, compared to that period last year, which saw a whopping 47% growth rate. Despite that slowing sales curve, EV sales in the States are expected to beat last year’s record of 1.19 million vehicles.
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