Automotive giant Stellantis has announced plans to construct a fourth gigafactory on the European continent, signing a memorandum of understanding with Chinese battery giant, CATL.
Stellantis, the parent-company of brands like Jeep, Fiat, Citroen, Chrysler, Alfa Romeo, RAM, Peugeot and more says that the plan would help to fast-track its supply of more affordable battery packs for electric vehicles.So far, the two companies have finalised an agreement for the supply of battery cells with a lithium iron phosphate (LFP) chemical makeup, though a 50-50 joint venture for a new gigafactory is also on the table, according to reports.
LFP batteries are known to be a more cost-efficient cell to produce on a large scale, though they often lack the same capacity as a battery with a nickel manganese cobalt makeup.
They could, however, unlock new pathways for Stellantis to offer more affordable electric vehicles for key markets in Europe, particularly for urban-dwelling buyers that don’t need huge range figures.
Reuters writes that Stellantis’ Global Head of Purchasing and Supply Chains, Maxime Picat, has said a fourth gigafactory based in Europe would help to scale up the company’s production of battery cells and modules for EVs across its sub-brands.
“Definitely what we are aiming at is to grow those LFP batteries on multi-segment, because affordability is needed on many different segments, being passenger vehicle or potentially commercial vehicles,” Picat said.
Officially, the MoU aims to build “a bold technology road map to support Stellantis’ cutting-edge battery electric vehicles” and identify avenues to “strengthen the battery value chain,” the latter of which may be a reference to a fourth battery manufacturing centre.
The announcement comes just a few weeks after Stellantis acquired a 20 per cent stake in Chinese electric vehicle manufacturer, Leapmotor, for a reported USD $1.6 billion.Stellantis has previously announced plans to have a completely battery-electric passenger vehicle lineup in Europe by 2030, while forecasting up to 50 per cent of its sales in the U.S. market will be a battery-electric car or truck by the turn of the decade.
“This MoU with CATL on LFP battery chemistry is another ingredient in our long-term strategy to protect freedom of mobility for the European middle class,” says Stellantis CEO, Carlos Tavares.
“CATL is the industry leader in this sector and together with our iconic vehicle brands, we will bring innovative and accessible battery technology to our customers,” he added.