Toyota to Build First US Battery Plant in North Carolina

Toyota Announces First U.S. Battery Factory in North Carolina

Toyota Motor has confirmed plans to construct its inaugural battery manufacturing facility within the United States, specifically in North Carolina. This decision aligns with a growing trend among automotive manufacturers to secure greater control over their battery supply chains through internally managed production.

Investment and Production Timeline

The company will allocate $1.29 billion towards the establishment of Toyota Battery Manufacturing, North Carolina (TBMNC). Production is projected to begin in 2025. This investment represents an initial component of a broader commitment to dedicate $3.4 billion to automotive battery development within the U.S. by the year 2030.

Factory Capacity and Sustainability

Upon full operation, TBMNC will feature four production lines. Each line will be capable of producing batteries sufficient for approximately 200,000 electric and hybrid vehicles. Toyota intends to expand this capacity to at least six production lines. This expansion would enable the factory to manufacture batteries for 1.2 million vehicles annually.

The new facility is expected to generate around 1,750 jobs. Furthermore, Toyota has committed to powering the battery production process entirely with renewable energy sources.

Impact of Potential Tax Credit Revisions

This announcement coincides with ongoing congressional discussions regarding modifications to the electric vehicle consumer tax credit. Currently valued at approximately $7,500 for qualifying OEMs, the credit is under review.

Proposed amendments include an additional $500 incentive for vehicles with batteries manufactured domestically. A further $4,500 bonus is suggested for EVs assembled in the U.S. at facilities with unionized workforces.

Toyota's Position on Tax Credit Changes

Toyota has voiced strong opposition to these proposed revisions, characterizing them as “blatantly biased” in a communication to lawmakers. Support for the bill has been expressed by major automotive companies – Ford, General Motors, and Stellantis – alongside the United Auto Workers union.

Industry Trend Towards In-House Battery Production

Toyota joins a growing number of automakers investing in domestic battery manufacturing. This move is driven by a desire to mitigate potential disruptions in the supply of raw materials and critical battery components.

As previously highlighted, strategic partnerships and joint ventures with battery suppliers, such as GM’s Ultium collaboration with LG Chem and Ford’s agreement with SK Innovation, demonstrate the increasing recognition among OEMs of the need for supply chain control.