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Toyota and Stellantis build EV battery plant in the US

Toyota Motor Ltd

TM 1.13%

And Jeep’s parents

Stellantis

STLA -1.86%

Nevada announced on Monday that it will build a separate battery plant in the United States. This is the latest in a series of high-value investments by automakers seeking to expand sales of electric vehicles.

Tighter fuel economy goals Set by the Biden administration, coupled with a wide range of efforts around the world, car companies are being encouraged to spend a total of tens of billions of dollars on new plants for electric vehicles and the batteries that power them.

Toyota said it plans to spend $ 3.4 billion by 2030 to manufacture batteries for electric vehicles in the United States. Previously, he said he would spend about $ 9 billion. Construction of battery factory Worldwide as part of a $ 13.5 billion battery program that includes research, but it did not specify how much would be spent in the United States

Toyota did not provide a complete breakdown of US spending, but said Toyota and its affiliates would spend $ 1.29 billion on the new battery plant. The plant will begin production in 2025 and aims to create new jobs for 1,750 people, the company said.

Separately, Stellantis said it has partnered with LG Energy Solution, South Korea’s battery manufacturing division.

LG

The conglomerate and the two companies building a new lithium-ion battery plant in the United States did not disclose the investment, but said the plant could produce batteries with a total output of up to 40 gigawatt hours each year. We will supply hundreds of thousands of EVs.

President Biden has called on automakers to increase sales of electric vehicles.


Photo:

Michael Brochstein / Zuma Press

The announcement highlights two major paths automakers are taking with regard to batteries. Some companies, like Toyota, plan to manufacture many of their batteries in-house.

Ford motor Ltd

NS -0.83%

Also, in the end Build your own battery..Stellantis and

General Motors Ltd

GM -1.58%

Is affiliated with an electronics manufacturer for batteries.

“We have pretty good resources,” said Chris Reynolds, Toyota’s Chief Administrative Officer for North America. “That doesn’t mean we never have a partner. We are always looking for the right partner.”

Toyota is skeptical of EVs compared to other companies in the industry, and its plans acknowledge that there is increasing pressure on the development and sale of battery-powered vehicles.

Earlier this year Toyota said it plans to have 15 battery-powered models It will be sold by 2025. The US has not yet sold mass market EVs, but plans to prepare the first model next year. Toyota hopes to sell about 2 million electric vehicles annually worldwide by 2030. This includes electric vehicles powered by both batteries and hydrogen fuel cells.

Toyota’s competitors have greater ambition. GM plans to spend $ 35 billion on electric vehicle and battery plants by 2025. Stellantis, with brands such as Jeep, Ram and Chrysler, Spend $ 35.5 billion In the same period. In contrast, Toyota’s new US battery plant will initially focus on producing batteries for hybrid models.

Toyota CEO Akio Toyoda has criticized governments around the world for banning or restricting the sale of gasoline-powered vehicles, taking millions of jobs and for most buyers. He said the price of the car could be out of reach.

Volkswagen invests more in electric vehicles than other legacy automakers in the United States. The WSJ will enter the engine plant, which is transforming into a battery plant, as the German giant aims to change its image and become a Tesla rival.Photo Illustration: George Downs

“Some politicians say,’Let’s make everything an electric car,'” Toyoda said at a press conference in September as chairman of the Japan Automobile Industry Association. “I don’t think it’s right.”

“We can’t forget that carbon neutrality is also a matter of work,” Toyoda said.

Many automakers and suppliers reflect Toyota’s concerns Electric car priceIt is driven primarily by the cost of lithium-ion batteries.

Toyota will have the majority of cars sold in the United States over the next decade Powered by a gasoline engine, at least partially.. According to the company, hybrid vehicles that combine electric motors and gasoline engines rely more on well-established technology to provide the right combination of environmental friendliness and affordability. Toyota says it has sold nearly 19 million hybrid vehicles since it launched the Prius in 1997.

This investment comes when Congress is considering a proposal to increase incentives to make electric vehicles more affordable.

Toyota and many other foreign automakers do not have members to manufacture cars in the United States. That is, their electrical models are not subject to full proposal-based incentives unless the factory is organized. These foreign car companies have criticized the legislation, saying they will be at a disadvantage compared to GM, Ford and Stellantis, which have factory workers representing the union in the United States.

“If you’re contributing to carbon reduction, whether you’re unionized or unionized, what you produce deserves to be treated even fairly,” Toyota’s Reynolds said.

Buying and selling cars during a pandemic

Write in Sean McLean sean.mclain@wsj.com

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Toyota and Stellantis build EV battery plant in the US

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