Mercedes Benz and Stellantis part of huge JV for European battery production

Mercedes Benz, Stellantis, Siemens and TotalEnergies have agreed on a joint venture to build three gigafactories in Europe to help manufacture electric vehicles.

Since the recent European energy crisis, electric vehicles are increasingly in demand by consumers, businesses and even governments. And this deal, worth around 7 billion euros ($6.79 billion), seeks to address that problem. According Reutersthe joint venture called Automotive Cells Company (ACC) will build three gigafactories and is currently studying sites in Billy-Berclau Douvrin, France, Kaiserslautern, Germany, and Termoli, Italy.

For car manufacturers such as Mercedes Benz and Stellantis, European domestic batteries are hard to come by. But with the creation of ACC, automakers will have a new source to meet demand. Each proposed gigafactory has a projected capacity of 40 GWh per year by 2030. That’s about the same capacity as Tesla’s Giga-Nevada facility.

The ACC would also create more competition in the battery market, long dominated by Chinese and South Korean battery options, but they are not the only ones looking to do so. Northvolt has made a name for itself by partnering with the Volkswagen Group, BMW Group and others. And Northvolt already operates two generation facilities with a combined output of 48 GWh, with more planned for the future.

The real challenge will be to differentiate in the increasingly crowded battery market. Northvolt has had success in recent years using ultra-low-cost power sources near its gigafactories to produce batteries while taking pride in its overall sustainability efforts.

This is where Siemens comes in. Siemens explained in a comment to Reuters that ACC will use its cloud-based service and software offerings to help maximize efficiency. “ACC uses virtually the entire spectrum of Xcelerator – from factory construction to production automation to building services,” said Cedrik Neike, Siemens board member. Reuters.

The ACC has a long time before being operational. Yet the issue of differentiation and specialization will make or break the new joint venture in the ever more competitive battery manufacturing industry.

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Mercedes Benz and Stellantis part of huge JV for European battery production