Chinese Battery Company Eve Establishes US Joint Venture... Another IRA Bypass

Collaboration with Daimler and Two Other Companies
Establishment of a Battery Joint Venture Worth 3.52 Trillion Won

Chinese electric vehicle battery company EVE Energy is partnering with Daimler Truck and others in the United States to establish a battery joint venture worth $2.64 billion (approximately 3.52 trillion KRW). Analysts interpret this move as a measure to circumvent the U.S. Inflation Reduction Act (IRA), which aims to exclude China.

According to major foreign media on the 8th, EVE Energy announced through a Shenzhen Stock Exchange disclosure the day before that it will establish a joint venture with three companies: Daimler Truck, Electrified Power, and Parker.

EVE Energy will invest $150 million (approximately 200 billion KRW) to secure a 10% stake, while the other three companies, including Daimler Truck, will each invest $830 million (approximately 1.11 trillion KRW) to hold a 30% stake.

The newly established joint venture will build a 21 GWh battery factory in the United States. Utilizing EVE Energy's technology, it plans to produce lithium iron phosphate (LFP) batteries for commercial vehicles.

EVE Energy stated, "The products manufactured at this factory will primarily be used in commercial electric vehicles in the North American market," and added, "This collaboration will provide all parties involved with benefits in reducing development and production costs."

The market views the establishment of this joint venture as a measure to bypass the IRA of the Biden administration. The U.S. provides subsidies under the IRA when batteries produced in North America or countries with which it has free trade agreements (FTA) are installed in electric vehicles assembled domestically. According to this law, Chinese-made batteries are not eligible for subsidy benefits. However, batteries produced by joint ventures between Chinese companies and U.S. companies or companies from countries with FTAs with the U.S. can receive IRA subsidies.

Previously, the world's largest battery manufacturer, Chinese CATL, decided to build a $3.5 billion (approximately 4.67 trillion KRW) electric vehicle battery factory in Michigan through a joint venture with Ford, which is also related to this situation. Ford owns 100% of the factory's shares, while CATL provides only the technology and receives royalties.

The Hong Kong South China Morning Post (SCMP) emphasized, "EVE Energy's decision to cooperate with overseas companies to build a factory in the U.S. is an example demonstrating China's growing capabilities in manufacturing key components for electric vehicle batteries."

This content was produced with the assistance of AI translation services.