A significant joint venture aimed at advancing the advancement of zero emission heavy vehicles has been announced in the USA, with Cummins, Paccar and Daimler Trucks announcing they are partnering to accelerate and localize battery cell production and the battery supply chain in the United States.
The planned joint venture will manufacture battery cells for electric commercial vehicles and industrial applications, creating highly desirable U.S. manufacturing jobs in the growing clean technology sector. Total investment is expected to be in the range of $US 2-3 billion for the 21-gigawatt hour (GWh) factory.
Accelera by Cummins, Daimler Truck and Paccar will each own 30 per cent of, and jointly control the venture, which will initially focus on the lithium-iron-phosphate (LFP) battery technology family for commercial battery-electric trucks.
The LFP battery cells produced by the joint venture and according to the companies will be able to offer several advantages compared to other battery chemistries, including lower cost, longer life, and enhanced safety, without the need for nickel and cobalt raw materials.
Accelera by Cummins, Daimler Truck and Paccar say they expect to see growing demand for battery technology throughout this decade and U.S. customers will benefit from a state-of-the-art dedicated battery cell factory.
The joint venture says that EVE Energy will serve as the technology partner in the joint venture with 10 per cent ownership and will contribute its industry-leading battery cell design and manufacturing know-how. EVE Energy is claimed to be a global leader in the manufacture of LFP battery cells for the vehicle industry and is publicly traded on the Shenzhen stock exchange.
The joint venture says that the strategic joint venture enables its owners to create the necessary scale for access to cost effective and differentiated battery cell technology, ultimately creating value for commercial vehicle customers in North America.
“We have the responsibility to decarbonize in a way that is best for all of our stakeholders and the planet. This requires working closely with key partners and the announcement reflects that action. Not only are we advancing a key technology solution for our customers, but accelerating the energy transition in the United States,” said Jennifer Rumsey, Cummins chair and CEO.
“Our vision is the highest quality, locally produced battery technology to enhance the operations of our customers and help them achieve their operational and environmental goals,” said Preston Feight, Paccar’s CEO.
Martin Daum, the CEO of Daimler Truck said the partnerships and a strict focus on costs and smart capital allocation are the key levers to succeed on the path towards sustainable transportation.
“This planned joint venture enables economies of scale beyond Daimler Truck. It is a key puzzle piece of our battery industrialization strategy, ensuring access to the right battery cell technology at the right cost,” Daum said.
“The partners are committed to reducing carbon emissions consistent with the Paris Climate Agreement,” Daum said
The transaction will be subject to closing conditions, as well as merger and control regulatory approvals including the submission of a voluntary notice to the US Foreign Investment review body