Gotion High-Tech to open cell plant in Illinois in 2024
In the USA, Chinese battery cell manufacturer and Volkswagen partner Gotion High-Tech is converting an existing factory in Manteno, Illinois, into a 50 GWh plant. The plant should be ready for operations in 2024 with 40 GWh targeted for battery cells and 10 GWh for battery packs.
According to an official statement from the state of Illinois, Gotion High-Tech plans to invest $2 billion – the equivalent of around €1.86 billion – to convert and equip the production facility. The Chinese manufacturer can count on state subsidies of $536 million for the factory, which is expected to create 2,600 jobs. Although details have not yet been released on the type of cells and packs, battery products made there will go to “existing Gotion partners as well as other EV manufacturers across North America.”
The state of Michigan had initially been under discussion as the location for Gotion’s U.S. factory, as indicated in 2022 by the company’s application for U.S. government subsidies. Gotion is said to have calculated investments of 2.36 billion US dollars and a start-up in 2024. Ultimately, Illinois won the bid for the plant’s location.
The Illinois government and local stakeholders speak of a “historic investment.” The Chinese company’s search for a location was well-timed for Illinois. In early 2023, the Invest in Illinois fund was signed into law in early 2023 to make Illinois more attractive when vying for large projects in highly competitive sectors like clean energy. Gotion High Tech is to be awarded $125 million in capital funding from Invest in Illinois. Local authorities also approved a property tax abatement for the plant for the next 30 years.
The US state is going to maximise the benefit of the large battery maker in the region by building out comprehensive EV hubs and supporting Illinois’ workforce by funding a new manufacturing training academy nearby. Illinois will also award an additional grant to workforce providers to expand training and prepare regional employees for the new jobs.
Jack Lavin, President & CEO of Chicagoland Chamber of Commerce, summarised: “Between today’s announcement, recent investments in the electric vehicle space throughout the state, and thanks to our skilled and diverse talent pool, world-class universities, and key infrastructure, it’s clear Illinois is well-positioned to be a leader in the electric vehicle space.”
Mark Denzler, President & CEO of the Illinois Manufacturers’ Association, said the site selection in Illinois was a “huge win” for the governor and the state of Illinois. “It builds on our state’s long history of auto manufacturing, and we are thrilled to welcome Gotion to Illinois as we work diligently to create an innovative ecosystem that supports our growing electric vehicle sector.”
Li Zhen, chairperson of Gotion High-Tech, said: “All that we see here [in Illinois] are of enormous value to us: an enabling business environment, a supportive state government for the new energy industry and their highly efficient work, as well as the prospects of the State of Illinois in the coming years.”
Li Zhen also emphasized that reusing an existing factory is happening against a backdrop of respectful use of resources. On an international level, Li Zhen said: “We believe that Gotion’s battery technology will help to boost e-mobility in North America and the economic and trade exchanges between China and the U.S.”
Gotion High-Tech (25.6 per cent of the shares are owned by Volkswagen) specializes in LFP cells. The company is on a trajectory of rapid growth and has commissioned or announced the construction of numerous battery factories, mostly located in China. In Germany, the company is scheduled to start production in Göttingen before the end of 2023. By 2025, Gotion aims to reach a global production capacity of 300 GWh. The Chinese battery company is also planning, constructing or operating plants in Vietnam and Thailand and is eyeing up possibilities for a plant in Morocco.
In December 2021, Gotion announced that it had signed a supply agreement with a major publicly traded US automaker. The agreement covers the supply of 200 GWh of LFP cells from 2023 to 2028, which will be cells manufactured in China. However, it was also said that the partners plan to localize the production and supply of LFP batteries in the U.S. Based on the information at the time, Tesla was considered a possible partner because Tesla already relies on LFP cells (primarily from CATL) on a large scale. A battery plant in Illinois would make little sense for Tesla, with its plants in California and Texas, so the publicly listed US automaker spoken of by the Korean battery manufacturer might be more likely to be another company.
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