Battery Funding for US and Foreign Manufacturers to Create Jobs

The Obama administration is hoping that $1.5 billion will finally be enough to make the U.S. a player in the global manufacturing of advanced batteries, which until now has been dominated by Asia.

Since most of the hybrids sold to date have been from Japanese manufacturers (with Toyota and Honda leading the way), it’s no surprise that the batteries that power their electric drive trains are also mostly from Japan. However, Ford has been purchasing batteries for its Escape Hybrid from Sanyo, and GM is buying batteries from Korean company LG Chem for the upcoming Chevrolet Volt. GM had been buying batteries for its hybrids from troubled U.S.-based Cobasys, which was just acquired by Japan’s Samsung.

This despite the Department of Energy and the Big 3 having been spent hundreds of millions of dollars on battery research in the U.S. through the U.S. Advanced Battery Corporation (USABC), dating way back to 1992.

For these past 17 years most of the federal funds have been aimed at research for battery components and basic materials that attempts to reduce the cost and increase the performance of battery technologies including lithium-on and nickel metal hydride. Now, the DOE is directing funds to develop battery manufacturing plants in the U.S., which will create jobs primarily in Michigan.

The funding announced Wednesday provides money for 8 manufacturing plants in Michigan, as well as plants in Indiana, Florida, Pennsylvania and Tennessee. While the USABC has given money exclusively to a handful of U.S.-based battery companies, the new funding will enable Korea’s LG Chem and Kokam (through a partnership with Dow Chemical), as well as Saft America (child of France’s Saft) to manufacture batteries here.

The line between “American” and “foreign” in the auto industry was obliterated years ago, so it is a wise move to open up battery manufacturing funds to international players. The work of the USABC is finally bearing fruit as A123 Systems, EnerDel and Johnson controls also received funds aimed at opening manufacturing plants.

While research and development is critical to advancing emerging technologies such as batteries that still face formidable technical challenges, at some point (meaning now), the DOE should tilt the balance towards commercial projects. This could help the U.S. to close the distance in the race to provide batteries for the upcoming generation of plug-in hybrid and all electric vehicles.

This article originally appeared on Matter Network.

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