France opens first electric vehicle battery gigafactory
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France opens first electric vehicle battery gigafactory

Jul 08, 2023

Plant expected to create 2,000 jobs as France aims to be self-sufficient in vehicle battery production by 2027

France's first electric car battery plant has opened in the country's former mining heartland as part of Emmanuel Macron's "reindustrialisation" plan.

Three government ministers and numerous local officials attended the inauguration of the Automative Cell Company's (ACC) gigafactory near Lens, seen as the first step towards France challenging China's dominance in the sector.

ACC, which is equally owned by TotalEnergies, Jeep maker Stellantis and Mercedes-Benz, has received a €1.3bn package of state aid from France, Germany and Italy as part of a €7bn plan to build a string of new facilities across the countries.

The Lens plant, which will begin production this summer, is expected to eventually create 2,000 jobs – including 400 this year – and produce 800,000 batteries a year. It is the first of three such plants, with sites in Germany and Italy to follow.

The area of northern France, less than 40 miles from the British coast, that has been hit by industrial decline, has been named ‘Battery Valley’. Earlier this month the Taiwanese battery maker ProLogium chose Dunkirk in the same region for its first foreign facility.

Macron hopes to create thousands of jobs by encouraging companies to invest in new factories.

Battery Valley has the enthusiastic support of the French president who this month unveiled a raft of green measures and tax credits – including electric vehicle (EV) subsidies – aimed at attracting billions of euros in new investment to "reindustrialise" France, create jobs and increase manufacturing from 10% of the country's economic output to 15%.

By contrast, Britain has been warned it is losing the electric vehicle battery race. Earlier this month, three major vehicle makers called on the UK government to renegotiate the Brexit deal saying elements threaten the future of the country's automotive industry.

Ford, Jaguar Land Rover and Stellantis, which also owns the Vauxhall, Peugeot and Citroën brands, warned the transition to EVs will be derailed unless the UK and EU delay stricter "rules of origin", due to kick in next year, that could add tariffs on car exports.

Separately, startup Britishvolt collapsed earlier this year. It had hoped to build a gigafactory at Blyth in Northumberland.

But, in a fillip for the UK's battery industry, the BBC reported last week that the Tata group, which owns Jaguar Land Rover, has lined up a possible deal to site a car battery plant in Somerset, picking Britain over Spain.

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France aims to be self-sufficient in vehicle battery production by 2027. Experts say the challenge could be hampered by China's domination of extraction and production of nickel, cobalt and manganese elements essential for lithium-ion batteries.

The EU will ban the sale of new petrol and diesel vehicles from 2035.

Local mayor, Jean Michel Dupont, said the ACC factory, the first of several planned in the region, was good news for the high unemployment area.

"There's the tax revenue paid back to the area, but above all, it's the attractiveness of our regions, because instead of having a wasteland, we have a fine company coming to set up here," Dupont said.

French union representatives were less enthusiastic, pointing out that any employment gains are expected to be offset by the loss of jobs at a nearby factory making petrol, diesel and hybrid vehicle engines due to close by 2025, expected to put 1,200 people out of work.

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