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Gotion to build US$2 billion gigafactory in Illinois

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China-headquartered lithium-ion battery manufacturer Gotion High-Tech has announced a new US$2 billion gigafactory in Illinois, US, targeting the electric vehicle (EV) and energy storage system (ESS) markets.

Illinois governor JB Pritzker and Gotion announced the company’s decision to locate its new lithium-ion battery manufacturing plant in the Midwestern state last week (8 September).

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Although it is being described as an EV battery plant, the facility will manufacture ESS solutions, alongside cell and pack production when it begins production in 2024. At full capacity it will produce 10GWh of battery packs and 40GWh of lithium-ion battery cells.

Gotion has been active in supplying batteries to the stationary ESS market, launching production facilities in Vietnam and Thailand partially targeting that market alongside EVs late last year while signing a deal to supply its products for the ESS segment in Japan earlier this year.

In the US, it entered into a master supply agreement (MSA) with engineering, procurement and construction (EPC) firm Borrego late last year to supply BESS equipment for Borrego’s solar and storage projects.

The investment in Illinois will be bolstered by incentive package called ‘REV Illinois’ and a new ‘Invest in Illinois’ fund, with the total package totalling US$536 million.

REV Illinois will allow Gotion to receive tax benefits totalling US$213 million over 30 years. It specifics that to qualify, projects will require a minimum investment of US$1.9 billion and the creation of 2,600 full-time jobs paying at least 120% of the average wage of similar job classifications in Kankakee County, where it will be located. The funding from Invest in Illinois will total US$125 million.

The full REV and Invest in Illinois agreements can be read here and here.

Lithium-ion battery production will also benefit from federal incentives under the Inflation Reduction Act, which for the first-time enables for-profit companies to receive a direct payment per unit of clean energy technology produced.

“Energy and environmental protection are our common challenges. To address them, solar power, wind, and energy storage systems are becoming the backbone of a new energy system and accelerate the revolution in the global energy landscape,” said Li Zhen, Chairman of Gotion High-tech.

“Today, we take another leap forward, announcing the largest electric vehicle battery production investment in Illinois to date. It’s my pleasure to welcome a world-leading battery manufacturer — Gotion — to Illinois,” said Pritzker.

Gotion is already building a battery plant in Michigan which has faced opposition because of concerns over the company’s China links.

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