On Tuesday, France will officially open a gigafactory that produces batteries. This is the first of four similar factories constructed by European and Asian companies in the northern region of France.
Significant Achievement for Europe
Automotive Cells Company, a joint venture between Stellantis, Mercedes, and TotalEnergies, is investing 2 billion euros ($2.20 billion) in a development project. The French state and local authorities are contributing almost half of the investment.
It highlights the race between European governments to attract global carmakers as they seek to bring the supply of components for electric vehicles closer to their main markets, according to Reuters.
Mercedes-Benz CEO, Ola Källenius, stated that the new ACC plant represents a significant achievement in Europe's efforts to improve its automotive industry by making it more resilient, competitive, and sustainable, particularly in the electric era.
The plant will commence lithium-ion battery production later in the year, with an initial capacity of 13 GWh, increasing to around 40 GWh, enough to power approximately 500,000 vehicles annually. According to the companies and regional authorities, the plant is anticipated to generate up to 2,000 employment opportunities by 2030.
ProLogium from Taiwan and Envision AESC from China have revealed their intentions to construct gigafactories in the northern area of Dunkirk, France.
Additionally, Renault has partnered with Verkor, a local startup, in the exact location to manufacture batteries for their high-end electric models.
Europe relies heavily on batteries from Asia for electric cars, and leaders of different countries are providing additional incentives to promote the industry's growth.
This has become more pressing after the US implemented the Inflation Reduction Act, which provides significant tax subsidies to reduce carbon emissions and increase domestic manufacturing and production.
The President of France, Emmanuel Macron, personally worked to ensure that at least one gigafactory would be established in the Dunkirk area. He has also set a goal for France to produce two million electric vehicles by 2030.
Read also: Tesla's New Megafactory in Shanghai, China Plans to Produce 10,000 Batteries Yearly
The Increasing Demand for Electric Vehicles
The demand for electric vehicles is increasing rapidly, and Europe has identified that the production of batteries holds a crucial position in this market. Establishing gigafactories in France will help reduce its dependence on Asian battery manufacturers while promoting local employment opportunities.
In addition to government incentives, carmakers are investing heavily in their research and development efforts toward sustainable mobility solutions. Mercedes-Benz's parent company Daimler AG recently announced an investment of €70 billion ($83 billion) over the next five years to develop carbon-neutral technologies.
Meanwhile, Tesla remains dominant, with its Gigafactory located in Berlin-Brandenburg set to become one of the largest factories globally upon completion. Other players like Volkswagen Group have also announced plans for six European gigafactories by 2030.
With these developments, it seems like Europe is well on track toward achieving its goals for sustainable transportation while boosting economic growth through job creation initiatives to make a more resilient automotive industry capable enough to meet future demands.
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