By and large, the United States is being left behind in the global boom of battery manufacturing. However, the new factory that German battery maker Akasol announced today for a site near Detroit will bring modest capacity and 200 jobs to Michigan.

Akasol plans to begin production at the new facility in 2020, and to reach 400 megawatt-hours of annual production in 2021 in three shifts. This will involve an investment in the “mid two-digit million euro range” over the course of the next five years, and the battery maker notes that the factory will benefit from a grant from the state of Michigan.

The facility will initially produce the AKASystem OEM PRC battery system for commercial vehicles, which is based on lithium-ion technologies and which Akasol says is the first system compatible with the standard plug-in hybrid electric vehicle (PHEV) modules of all major manufacturers. The system comes in 25 kWh and 33 kWh versions.

Later, Akasol states that it plans to focus on “battery systems with high energy density.” The company estimated that a third of its production will go to existing customers, which includes “a well-known Swedish manufacturer of trucks and buses,” but notes that it is seeking out North American customers.

“(The new factory) is also a central component of our international expansion strategy,” observes Akasol CEO Sven Schulz. “With our unique battery expertise from module to system level and the fact that we are already mass-producing for market-leading companies, we are well on the way to becoming the European market leader in commercial vehicle battery systems. Our new Michigan site will accelerate business development and activities with new and existing North American customers.”

Chemical supplies

Michigan officials quoted in Akasol’s press release cite Michigan’s “modern manufacturing industry” and its “robust supply chain.” But while Akasol did not say in the release where its components will come from, China is increasingly dominating not only lithium-ion battery manufacturing, but the supply of the chemicals needed to make these batteries as well.

According to estimates from Benchmark Mineral Intelligence, China represented 51% of the lithium chemical supply, 62% of the cobalt chemical supply and 100% of the spherical graphite supply used in lithium-ion battery manufacturing in 2018, despite representing a minority share of lithium and cobalt production. By contrast, the United States represented 7% of the world’s lithium chemical supply, and does not produce meaningful amounts of these other materials.

With more lithium-ion battery manufacturing it is possible that chemical supply and other supply chains would be incentivized to move to the United States. However, the 400 megawatt-hours of manufacturing that Akasol’s facility will represent is a drop in the bucket when measured against the more than 200 gigawatt-hours of global battery manufacturing, the largest portion of which is in China, or the battery factories which are planned.