Being able to secure a reliable supply of batteries is perhaps the most important factor for any automaker wishing to make electric cars in large quantities. Tesla has long proven that having your own factories can help prevent any production chaos. Many new automakers have now made it a priority to include battery factories in their electrification plans. Today, both Toyota and Stellantis have announced their intentions to built US-based battery factories.
Stellantis Battery Factory
With the news, Chrysler now joins the rest of the “Big Three” in dropping news about new battery factories. Both GM and more recently, Ford, have already announced their investments towards more battery factories in the United States.
Stellantis’s battery factory news comes a few months after their EV Day which detailed some of their upcoming vehicles and technologies. During the event, we learned that Stellantis has committed to spending more than €30 billion through 2025 in electrification and software development. No doubt part of that money will be going to funding future battery factories.
Today’s announcement let us know that Stellantis has entered into a memorandum of understanding to form a joint venture with LG Chem. The plan calls for a battery factory located in the US to become operational at the beginning of 2024 and be able to output 40 GWh worth of batteries.
This will serve as one piece of Stellantis’s overarching goal of having 260 GWh worth of output overall by 2030. The brand also hopes to have 40% of US sales be electrified by 2030 as well.
Groundbreaking is expected to begin in the second quarter of 2022.
Toyota Battery Factory
Another laggard in the electrification race, Toyota, has recently been picking up some steam. The Japanese automaker showed off its first electric SUV along with announcements of more electric cars coming soon.
To support the production of these future EVs, Toyota has announced that they will be putting approximately $3.4 billion in batteries in the United States through 2030. Of that money, approximately $1.29 billion will be used to build a battery factory. The new facility is planned to first produce lithium-ion cells for hybrid cars.
Admittedly it is worrying to think that Toyota doesn’t see their EV volume be high enough in 2025 to warrant having the US factory produce cells for EVs. Wishful thinking will say that since a lot of Toyota’s models will be made in Japan, that it should be the duty of the Japanese factories to produce EV cells.
A Lesson Learned
A few years ago it was very uncommon to read automakers commit to building their own battery factories. Many early plans were content with just receiving batteries from LG Chem, CATL, or whoever else. Well over those few years those same automakers have bared witness to constant supply constraints that cut production or outright halt it. And in the grand scheme of things, not a lot of EVs have been made. The need to secure a supply of batteries will only grow in the future.
What do you guys think of this evolution in automobile production? Let us know down in the comments below.
