DETROIT (AP) — General Motors said Wednesday that a new electric vehicle battery plant under construction in Ohio has begun manufacturing batteries that could help customers secure federal tax credits.
The joint venture near Warren, Ohio is focused on training staff in preparation for expansion. A spokesman for the joint venture stated that it is producing batteries but has not yet shipped them. They will be used in vehicles equipped with GM Ultium batteries, which currently include the Hummer EV, the Chevrolet Silverado EV pickup truck and the Cadillac Lyriq electric SUV.
Ultimately, however, the plant must help GM’s electric vehicles secure a $7,500 federal tax credit per vehicle.
Under the recent Inflation Reduction Act, electric vehicles and their batteries must be made in North America in order to qualify for the loan. Battery minerals must also be mined or processed on the continent or they will lose half of the tax credit. And the battery must not contain components from China, another difficult hurdle.
The requirements are aimed at creating a North American electric vehicle supply chain so that the country is not dependent on China and other foreign countries.
GM said it is working to meet the requirements. The Ohio plant, which is being built with battery maker LG Energy Solutions, is a step toward a loan that is critical to boosting electric vehicle sales. No automaker wants to bring an electric car to market that costs $7,500 more than the competition.
The $2.3 billion, 2.8 million square foot battery plant now has 800 employees and will eventually employ 1,300 people. The plant is located near Lordstown, Ohio, where GM has closed a large small car assembly plant.
GM aims to make only passenger electric vehicles by 2035, and CEO Mary Barra has promised to replace Tesla as the leader in electric vehicle sales by mid-century.