Stellantis likely planning another European battery factory without ACC

Spain currently appears to have the best chances for the fourth European battery factory, as Stellantis operates three vehicle plants in Spain (Madrid, Vigo and Zaragoza). According to Spanish media, Zaragoza is emerging as the most likely location for the battery factory. Rumours about this were already circulating at the end of November 2023.

What is new is that this battery factory in Zaragoza could be operated by Stellantis together with CATL and produce LFP cells. This would fit in with the partnership with CATL for LFP batteries in Europe officially announced by Stellantis at the end of November.

The three existing battery factories in Douvrin, Kaiserslautern and Termoli are officially run by ACC, which is operated jointly with Total and Mercedes-Benz. While ACC has two other partners on board, the fourth battery factory is said to be a 50:50 joint venture. However, this has not yet been confirmed.

The Spanish portal La Tribuna de Automoción writes that the overall project would have an investment volume of around 2.5 billion euros, although there is also to be financial support from the central and regional governments. The exact amount is probably still part of the ongoing negotiations – and one of the key points for Stellantis’ final decision in favour of or against the factory. The Ministry of Industry and Tourism is said to have promised 55.87 million euros. As the battery factories of Envision in Navalmoral de la Mata and VW/PowerCo in Sagunt near Valencia are being subsidised with significantly higher sums, Stellantis’ expectations “will not be met”, as the report states.

The government of the province of Aragón and Spain’s Prime Minister Pedro Sanchez are now apparently looking for other ways to promote the project. Politicians certainly seem to understand the industrial logic behind the plans, as having its own battery factory, especially with low-cost LFP cells, would be a real competitive advantage for the three Stellantis plants in Zaragoza, Vigo and Madrid – especially as Stellantis has already announced that it will build small electric cars based on the upcoming STLA Small platform in Spain. In 2023, the Group will have built just over one million vehicles in the three plants – almost 41 per cent of the total Spanish production of 2.46 million cars.

The fact that Stellantis does not shy away from tough decisions in the face of what the Group sees as insufficient support was already evident in Canada. In March 2022, Stellantis announced plans to build a 45 GWh factory in the Canadian province of Ontario together with LG Energy Solution. In May 2023, the ongoing construction work in Windsor was interrupted because the PowerCo battery factory also planned in Ontario was receiving more funding. An agreement was then reached in July and work was resumed. The planned start of production in Windsor is still in 2024.

latribunadeautomocion.es, forococheselectricos.com (both in Spanish)