Tesla Co-Founder's Company Announces $3.5-Billion Battery Plant

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The Battery Materials Campus will reduce America's reliance on Asia for critical components.

Redwood Materials, a maker of battery components and recycler of batteries created by Tesla co-founder JB Straubel, has announced its next Battery Materials Campus, representing a $3.5 billion investment in the local community.

Located just outside Charleston, South Carolina, the region has become known as the "Battery Belt." The new facility will help meet America's need for anode and cathode components, which currently have to be sourced via a 50,000+ mile global supply chain. The rapid growth of the so-called Battery Belt between Michigan and Georgia has been driven by the new Inflation Reduction Act, and that's where Redwood's new facility comes in.

While EV battery manufacturing grows in America, Redwood's new facility will help automakers fully meet the requirements of the Inflation Reduction Act, which requires EVs to be built here and their components locally sourced.

Redwood Materials

Initially, many new EV factories in America will still rely on suppliers in China, Japan, and South Korea for specific components.

"Unless metals like lithium and nickel are produced and refined and remain in the country for domestic anode and cathode manufacturing at scale, these American battery cell facilities will have to continually source the majority of their components, predominantly from Asia," said Redwood in a statement. "This will send most (50-75%) of the economic value and job creation overseas."

Once ramped up, the Battery Materials Campus will be able to produce 100 gigawatt hours of cathode and anode components annually, or enough to power over one million electric vehicles.

Redwood Materials/YouTube

"There's a giant wave of battery manufacturing heading toward the US because of the [Inflation Reduction Act], so having a footprint for us that's more geographically spread across the US is super helpful," said Straubel when speaking to Forbes.

EV production is set to grow in South Carolina imminently. BMW already announced a $1.7 billion investment to assemble EVs at its Spartanburg plant in the state, and Volvo's critical EX90 electric SUV will also be built in the region. Conventionally-powered vehicles like the Volvo S60 and Mercedes-Benz Metris are also produced in the area.

Redwood will refine, recycle, and manufacture the anode and cathode components on a site covering over 600 acres. This new Battery Materials Campus will also create 1,500 new jobs in the area, adding to the roughly 72,000 auto workers already employed in the state.

Redwood Materials/YouTube

"The Inflation Reduction Act really sets a pretty clear imperative for almost everyone building batteries and EVs in the United States to find a domestic supply chain, so it's an exciting time," said Straubel.

Redwood has already raised $1 billion from investors like Ford but will need another $4.6 billion for the new campus and additional facilities in Nevada. For now, it's unclear which automakers and battery companies will buy battery components made at the new campus. Still, the video above might provide a clue, with models like the Toyota bZ4X and Ford F-150 Lightning making appearances - no surprise since both brands already have ties to Redwood.

Redwood says it will "break ground" on its new South Carolina Campus as early as the first quarter of 2023, and its first recycling process will kick in before the end of next year. The facility will be 100% electric and use zero fossil fuels for its operations.

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Source Credits: Forbes

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