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BMW Plans EV Battery Factory in U.S.

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BMW will spend $1 billion on EV production and $700 million for a new battery facility. | Image by Roberto Baldwin, The Verge

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BMW announced that it will start construction on an EV battery factory in South Carolina as part of a $1.7 billion investment to expand its U.S. EV output.

The new high-voltage battery assembly facility will be located in Woodruff, not far from BMW’s vehicle plant in Spartanburg, which will be expanded for the production of electric cars.

This investment will help put BMW in compliance with recent changes made to the federal EV tax credits, which now require manufacturing battery components in North America, along with other stipulations not without controversy.

BMW’s announcement follows an earlier one in which the company confirmed that it will use a new round-format battery cell in its New Class EV models starting in 2025. These round-battery cells are said to boost charging speed by 30%, improve range by 30%, and augment energy density by more than 20%.

According to Frank Weber, a member of the BMW board of management, not only will this new lithium-ion cell “bring a huge leap in technology,” but it will also allow for a reduction in “CO2 emissions from cell production by up to 60%.”

To help carry out its plans for the EV battery plant which will produce these round-battery cells in South Carolina, BMW is partnering with Envision AESC, a Japan-based energy company. The expected result of this collaboration is a battery manufacturing complex with an annual production capacity of up to 30 GWh.

In order to meet the anticipated demand for the New Class EV vehicles by BMW, the group has also formed double-digit billion-dollar contracts with CATL and EVE Energy to build two additional battery factories in China and Europe.

BMW plans to have a minimum of six EV models in production within the U.S. by 2030.

Since the establishment of EV tax credits aiming to incentivize expanded EV and EV battery manufacturing operations in the U.S., automakers have been setting themselves up to reap the benefits. Automakers who qualify for the tax credit will receive up to $7,500 per vehicle, so long as the EV batteries are made within the U.S. and not outsourced from international production.

However, a few tax credit requirements are concerning to some automakers, such as those aimed at preventing the use of Chinese EV battery components and minerals. BMW Group Chairman Oliver Zipse criticized these requirements in an interview with Reuters, explaining that they were completely unrealistic and posed a potential threat to the development of the EV industry.

Nonetheless, several automobile manufacturers have recently announced their plans to bring their EV operations to the U.S., including FordGeneral Motors, Hyundai, and Honda.

The majority of the new EV battery factories will be located within the south, lending to the new nickname of the “battery belt.”           

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