CATL will Build an EV Battery Plant in North America!

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Contemporary Amperex Technology Co. Ltd., the world’s largest maker of electric vehicle batteries, is researching places for a new $5 billion battery facility in North America. According to people familiar with the proposal, it is evaluating locations in Mexico, Canada, and the United States for an 80GWh facility that would serve Tesla and other EV producers.

The commonly held belief is that China has outflanked the United States in a global chess game, putting the latter’s economic, energy, and national security interests in danger.

CATL has grown quickly to become the world’s leading battery manufacturer thanks to government support.

Jim Greenberger, executive director of NAATBatt International, a trade group that supports battery development and manufacturing in the United States, said he has no objection to a CATL plant in North America as long as the business brings battery manufacturing technology and know-how, not just low-wage assembly jobs, to the country. China‘s joint ventures with American firms should be emulated by the United States.

Greenberger believes that the United States may benefit from some coaching in the areas of battery cell design, manufacturing equipment, and factory operations.

Volta Energy Technologies, a venture capital company created out of Oak Ridge National Laboratory to invest in energy storage, is led by Jeff Chamberlain.

For varied purposes, Chamberlain supports CATL placing stakes in the ground in the United States. First, the United States will confront a battery supply shortage, therefore it will need all the cells it can acquire. Second, constructing those cells here will result in the creation of tens of thousands of employees. Third, the more batteries produced in the United States, the quicker electric car adoption will accelerate and a local supply chain will form – in other words, the pie will rise.

The whole purpose of this energy transition, decarbonization, is how quickly can we develop and integrate the supply chain? We want CATL to stay here because it allows us to do both.

remarked Jeff Chamberlain.
CATL's New Vehicle Batteries at a Trade Fair in Fuzhou, Fujian, East China
CATL’s New Vehicle Batteries at a Trade Fair in Fuzhou, Fujian, East China

As a VC firm, Chamberlain has one little concern for firms considering working with CATL: their IP may be filtered back to China, so they’ll need to be cautious about security.

Then I looked for a tiny battery company that would be worried about being undercut by CATL, whose sheer size and cost competitiveness makes even its fellow cell-making behemoths sweat.

Chaitanya Sharma is the CEO of iM3NY, a business that is establishing battery manufacturing on a former IBM property in Endicott, New York. The business intends to commercialize a chemical developed by Stanley Whittingham, who was granted the Nobel Prize for his work on lithium-ion batteries in 2019.

When Sharma heard about CATL, he was pleased, he said. His firm produces prismatic, or rectangular-shaped, batteries, which are less widespread in the United States than Tesla‘s cylindrical cells or GM‘s Ultium batteries’ pouch cells. As a result, he’s had trouble finding a manufacturer that can build rectangular-shaped cans and lids for his cells.

CATL manufactures prismatic cells as well. Sharma believes that piggybacking on a large customer would make it easier and less expensive for his organization to obtain what it requires. And right now, battery demand is so robust across a wide range of businesses that he isn’t concerned about being suffocated by larger firms.

There’s enough volume here for every single sort of producer. I’m looking forward to CATL coming in and lowering the costs of the raw material supply chain, so we’ll be welcome them.

said Chaitanya Sharma.

Abigail Seadler Wulf, the director of essential minerals strategy at Securing America’s Future Energy (SAFE), a Washington think group that advocates for the U.S. reducing emissions and supply chain security, isn’t so enthused. CATL’s entry might worsen the country’s reliance on China, she added, because the U.S. hasn’t made a meaningful commitment to creating the ability to handle battery materials or produce battery parts.

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