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Two billion dollars! GOTION HIGH-TECH Gaoke to build a super battery factory in the U.S.

Two billion dollars! GOTION HIGH-TECH  Gaoke to build a super battery factory in the U.S.


Preface: In May 2023,GOTION HIGH-TECH  successfully applied for and participated in the 2023 "Choose America" Investment Summit held in the United States through the Global Investment Council (GIC), and had full docking exchanges with the participating U.S. states and relevant investment in the U.S. service organizations. Congratulations on the successful landing of GOTION HIGH-TECH's battery plant in Illinois!

China's GOTION HIGH-TECH  will build a $2 billion lithium battery manufacturing plant for electric vehicles in Manteno, Illinois, the largest investment in an electric vehicle battery plant in the history of Illinois, the governor's office of the U.S. state of Illinois said on Sept. 8, local time.

GOTION HIGH-TECH   has established strategic alliances with SAIC Group, JAC, Chery Automobile, Changan Automobile, Geely Automobile, Great Wall Automobile, leapmotor, WM Automobile, and Hezhong New Energy. The investment will be subsidized by the State of Illinois with US$536 million (RMB 4 billion) from the State's REV incentive program (Reimagining Energy and Vehicles) and a fund called "Invest Illinois". Invest in Illinois" fund. Through the REV incentive program, GOTION HIGH-TECH  will receive $125 million. In addition to this, GHS is eligible to receive $213 million in tax credits over the next 30 years. The requirements are that GOTION HIGH-TECH  make a minimum investment of $1.9 billion and create 2,600 full-time jobs that pay no less than 120 percent of the average local wage for similar jobs.

The plant will specialize in lithium-ion battery cells, battery pack production and energy storage systems, and will have an annual production capacity of 10GWh of Pack capacity and 40GWh of cell capacity upon completion. The plant will be based on an existing local plant that will be remodeled in two phases and is expected to cover approximately 150 acres (910 acres). Upon completion of the first phase of the plant renovation, it is expected to commence production in 2024. The plant will help enhance the company's ability to supply existing and potential partners in North America to meet the growing demand for batteries in the electric vehicle industry.


In addition, it is reported that the State of Illinois, around the goal of building a comprehensive electric vehicle center, will also fund a new manufacturing training institute nearby to train skilled battery production workers locally and support the development of local industry.

Overall, the investment will accelerate the development of lithium iron phosphate battery technology in the U.S., reduce the cost of electric vehicles in the U.S., and ultimately accelerate the development of the U.S. new energy vehicle market; on the other hand, the localized production in the U.S. will help GOTION HIGH-TECH to expand its customer base of automobile companies overseas, especially in the U.S.

Related: Lithium industry to go overseas as a trend

GIC learned earlier from Li Chen, General Manager of Guoxuan America, that Guoxuan Gaoke plans to build two factories in the U.S., a battery factory and a battery material factory. The Illinois plant announced this time is one of the battery plants, and it is the second major investment of Guoxuan Gaoke after announcing in October 2022 that it would invest $2.4 billion to build a battery materials plant in northern Michigan, USA. The Michigan battery materials plant, which includes a plant that will produce 150,000 tons of battery cathode materials per year and two plants that will produce 50,000 tons of battery anode materials per year, was approved by the U.S. federal government in June this year.


Beginning in 2023, electric vehicles must have more than 50 percent of their battery components and materials manufactured or assembled in North America to qualify for the $3,750-per-vehicle tax credit. This percentage needs to reach 100 percent after 2029. Another $3,750 of the tax credit relates to key battery minerals. Starting in 2023, electric vehicles will need to have 40 percent of their battery-critical minerals mined or recycled in North America or countries with which the U.S. has trade agreements. The proportion of localized raw materials will grow at a rate of 10% per year, reaching 80% by 2027.


For Chinese battery companies, to build factories in the United States can meet the above requirements, at the same time, also be able to get the U.S. government and local government tax incentives and financial support.


China's Ministry of Industry and Information Technology data show that in the first half of this year, China's lithium battery product exports increased by 69% year-on-year, which is dominated by power batteries. From the performance of each family, in the first half of this year, ningde era's overseas revenue was 65.684 billion yuan, an increase of more than 1.9 times year-on-year, accounting for 35.49% of the total operating income. The overseas business revenue of Guoxuan Gaoke and Zhongxin Innovation Airline increased by 296.74% and 115.7% year-on-year; the proportion of overseas customers of Vonergy Technology is about 70%, and the proportion of overseas sales of lithium-ion lithium-ion lithium-ion lithium-ion lithium-ion lithium-ion lithium-ion lithium-ion lithium-ion is about 40%.


At the same time, in the first half of this year, Ningde Times, Hive Energy, Guoxuan Gaoke, lithium-ion battery, Xinwanda and other overseas investment plans announced. Overseas can be closer to customers through localized production and grasp the opportunity of rapid development of the industry; taking into account the popularity of cars in Europe, if the ban on combustion is on the agenda, its huge demand gap will inevitably be transformed into a new energy industry chain upstream and downstream enterprises of the huge development opportunities. But the "Inflation Reduction Act," "EU Battery and Waste Battery Regulations" and other European and American policies on China's power battery companies to develop overseas markets also have a negative impact.


The core reason is that Chinese enterprises "go out", the need to fight for access to developed markets, and North America as a mature commercial market, has always been the sea of Chinese enterprises must fight. Especially the U.S. new energy vehicle market, the industry as the most promising future incremental market. Data show that from January to May this year, the U.S. market share of new energy vehicles in the world is 12%, the U.S. market share of pure electric vehicles in the world rose to 13%.

In short, Chinese lithium enterprises overseas (U.S.) plant is not an optional, but has become a must!


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