A number of the world’s largest battery manufacturers have announced plans to build megafactories in Europe to supply the world’s fastest growing market for electric vehicles (EVs).
Korean manufacturer LG Chem announced on 3 June that it will build a $356m plant in Wroclaw, Poland that will cover the area of five football fields. The company says that despite its scale, it will be finished and in operation by the end of the year.
It will be followed by another Korean firm, SK Innovation, which last week announced plans to build a plant to supply batteries to automotive company Daimler. Last February, the company signed a contract to supply lithium-ion cells to Mercedes-Benz.
Kim Jun, SK Innovation’s chief executive, said Eastern Europe was the most probable location for the plant. He said: "We’re considering building a plant in Hungary or the Czech Republic. Eastern Europe offers cheap and quality labour forces. Germany is too expensive to build."
Work on this factory will start this year and the company plans to start operation next year.
If SK does choose Hungary, it will have as a neighbour Samsung SDI’s facility in Goed, 30km north of Budapest, which was completed on 30 May. This plant is capable of producing batteries for 50,000 electric cars a year, and will be supplied to manufacturers such as BMW and Volkswagen.
Across the globe, battery manufacturing industry is set to increase by 170% in the next five years, from 103GWh to 278GWh, according to statistics collated by Bloomberg New Energy Finance.
Despite Kim Jun’s assertion about Germany, battery megafactories are planned there as well.
On 22 May German Chancellor Angela Merkel layed the foundation stone for a $543m plant in the eastern German town of Kamenz.
This is being developed by Daimler to produce cells for EVs and stationary storage. The scheme will quadruple the size of an existing plant, which is owned by Daimler subsidiary Accumotive.
As a result of this increase in manufacturing capacity, the cost of batteries is expected to drop 41%
Image: German Chancellor Angela Merkel lays the casing of a vehicle battery as the foundation stone for a $543m plant in Kamenz, owned by Daimler subsidiary Accumotive (Daimler AG)
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JLR have recently opened their engine plant in Wolverhampton. Can we expect to see investment by them in a battery plant? Is HM Gov. pushing the agenda on battery manufacture for the UK?