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Toyota will build a battery factory in North Carolina in order to bring some of its electric vehicle supply chain to the US. The news comes on the heels of Toyota's announcement that it will invest around $13.6 billion in battery tech over the next decade, including a $9 billion investment in production, as it attempts to electrify its vehicle lineup.
Chris Reynolds, chief administrative officer for Toyota Motor North America, said that the new factory will be spread over the next decade, but production will start in 2025. In the first year, Toyota plans to produce 1.2 million battery packs for its electric vehicles.
The company said it will create 1,750 new jobs.
Reynolds said during the press conference that the investment will create at least 1,750 new jobs and help us develop and localize automotive battery production.
The taxpayers will have to pay for the factory. The Economic Investment Committee of North Carolina approved a $438.7 million tax incentive package to encourage Toyota to build in the state.
Toyota is building a battery factory as car companies scramble to ramp up production of EV. The BZ4X compact SUV will be Toyota's first long-range EV.
Ford and South Korean battery manufacturer SK Innovation are spending $11.4 billion on several new factories in Tennessee and Kentucky, while General GM is planning four new battery factories in the US with partner LG Chem. Volkswagen wants to have six battery cell production plants in Europe by the year 2030. The 250GWh production capacity of the Berlin battery factory is equivalent to the current world battery cell production capacity.
GlobalData predicts that global battery production will grow from 95.3GWh in 2020 to 410.5GWh in 2024.
The news is set against the backdrop of intense lobbying in Washington, DC, over the future of the federal EV tax credit, which currently provides shaves off the purchase price of some electric vehicles. The proposal to increase the credit to $12,500 for purchases of electric vehicles made in the US by unionized workers triggered a backlash from non-union companies. The ads in the newspaper accused the Democrats of playing politics with the environment.
Although the company was an early leader in gas-electric hybrid cars, Toyota viewed hybrid as a stopgap measure until hydrogen fuel cells became competitive. The company is trying to catch up with Nissan and has been lobbying to slow the US's transition to electric vehicles.
