Dutch Battery Firm Investing $1.8 Billion in Chinese Plant to Make EV Battery Cells

Dutch Battery Firm Investing $1.8 Billion in Chinese Plant to Make EV Battery Cells

Author: FutureCar Staff    

Dutch battery company Lithium Werks BV is investing 1.6 billion euros ($1.85 billion) in a massive lithium-ion battery factory in China to meet surging demand for electric vehicle batteries.

Lithium Werks and Chinese Zhejiang Jiashan Economic and Technological Development Zone Industry Corporation have signed a framework agreement for the construction of a 60 hectare battery gigafactory in the Yangtze river Delta. The facility will have production capacity of 8 gigawatt-hours per year, or the equivalent capacity of batteries to power 160,000 electric vehicles.

The factory will become the company's second Chinese manufacturing site and should start production in early 2021, Lithium Werks Chairman Kees Koolen said by phone to Automotive News Europe.

"We're in China again because it moves faster than others, it makes decisions quickly," Koolen said. "We're also in discussions with European governments but they're just doing a lot of talking."

The company will provide 20 percent of the cost in equity capital and raise the rest in project finance from a consortium of Chinese banks. Koolen expects revenue will reach $1 billion by 2020 and he plans to have 10 battery factories in operation by 2025.

Batteries will play a key role in both the energy industry to complement the increasing share of intermittent renewable power, as well as a cleaner alternative to gasoline and diesel engines prevalent in cars, buses and trucks across the world.

According to a 2018 report by the Capgemini Research Institute, the demand for lithium-ion batteries to grow tenfold during the next decade. To support this increasing demand, battery manufacturers will need to construct factories to deliver capacity in excess of 10,000 GWh in the next three decades.

"We need safe, reliable, clean and sustainable energy storage. Batteries are an essential part of the energy transition. They enable us to store wind and solar energy to make it available whenever people need electricity," said Kees Koolen, chairman of the board, Lithium Werks.

The deal is part of a broader partnership signed Tuesday between the Netherlands and China. Chinese premier Li Keqiang and Dutch Prime Minister Mark Rutte are announcing other large-scale deals at an event in The Hague.

China has emerged as a worldwide leader in the production and sale of electric vehicles (EVs). China remains the largest electric car market in the world, accounting for half of all electric vehicles sold last year. Nearly 580,000 electric cars were sold in China in 2017, a 72 percent increase from the previous year.  

FutureCar Staff
FutureCar Staff
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