In a significant effort to bolster European competitiveness in the electric vehicle (EV) sector vis-à-vis China, Stellantis and Mercedes-Benz have successfully raised close to €4.4 billion. This substantial sum aims to facilitate the construction of four new EV gigafactories across the European Union in the coming years.
According to a recent press announcement, the companies, in collaboration with Total Energies, have executed one of the largest debt fundraising operations witnessed in the European auto sector. The anticipated total funds to be raised stand at approximately €7 billion, earmarked for the construction of factories for their jointly owned battery maker, ACC. Notably, ACC presently operates a lithium-ion battery facility in Billy-Berclau, northern France, inaugurated just last year.
The forthcoming factory sites include one in Kaiserslautern, Germany, and two in Termoli, Italy, with an additional undisclosed location in France, as reported by Reuters. These initiatives are expected to generate around 6,000 new jobs collectively.
Prominent financial institutions participating in the financing arrangements comprise BNP Paribas, ING, Deutsche Bank, and Intesa Sanpaolo. Additionally, the French and German governments are contributing approximately €1.3 billion, whereas Italy’s involvement in the funding remains unconfirmed.
The European automotive industry, spearheaded by major players such as Stellantis and Mercedes-Benz, is strategically positioning itself against Chinese dominance in the EV sector and the latter’s firm grip on the battery supply chain.
Citing data from Statistica, it’s noted that China produced over 5.47 million Battery Electric Vehicles (BEVs) in 2022, representing more than half of global EV production. Notably, BYD outpaced Tesla in BEV sales during the final quarter of 2023, with 526,000 sales compared to Tesla’s 484,500.
Forecasts suggest that China will establish an additional 160 gigafactories by the decade’s end, in stark contrast to Europe’s expected 36.
In related news, Swedish lithium-ion battery producer Northvolt recently secured an additional $5 billion in funding, solidifying its status as one of Europe’s most well-funded startups. The company, bolstered by the largest-ever green loan from the EU, plans to utilize these funds to expand operations globally, including battery production facilities in Poland, Germany, and Sweden.
