SEOUL (Reuters) -Stellantis and South Korea’s Samsung SDI Co Ltd on Wednesday said they will build a second electric vehicle battery plant in Kokomo, Indiana, the hometown of United Auto Workers President Shawn Fain.
The union leader is currently fighting with the Detroit Three automakers over union representation of new battery factories. The UAW had no immediate comment about the announcement.
Stellantis and SDI said their second joint battery factory in Indiana is scheduled to open in 2027, and could employ 1,400 workers. The two companies would have a combined annual production capacity of 67 gigawatt hours (GWh) at the Indiana production site, Samsung SDI said in a statement.
The first joint plant is set to start production in the first quarter of 2025.
The announcement comes as Stellantis, the parent of Detroit’s Chrysler, Jeep and Ram truck brands, is coping with losses from nearly four weeks of strikes by the United Auto Workers at a Jeep plant in Toledo, Ohio, and parts depots around the United States.
Fain, who joined the UAW as a worker at one of Chrysler’s Kokomo powertrain plants, is demanding that Stellantis, General Motors <GM.N> and Ford Motor Co bring their joint venture EV battery factories under the union’s master agreements with the automakers.
Stellantis and Ford have so far resisted, saying the battery ventures are separate entities that need lower labor costs.
GM on Friday agreed to bring its joint venture battery operations under its master contract but the UAW and the automaker have not disclosed details of the agreement, including how much battery plant workers would be paid.
UAW-represented workers at GM’s joint venture battery plant in Lordstown, Ohio, in August won raises averaging 25% and now earn $20 an hour, still well below the $32-an-hour top wage at GM assembly plants.
For Stellantis, a second U.S. battery plant would help the company comply with U.S. Inflation Reduction Act domestic content rules that govern federal EV subsidies.
Samsung SDI last month said it plans to invest 2.7 trillion won ($2.01 billion) to build its second joint battery plant with Stellantis.
Stellantis, whose brands include Peugeot, Chrysler, Jeep, Ram, Alfa Romeo, Citroen and Opel, has announced plans to reach 100% electric passenger car sales in Europe and 50% car and light truck electric mix in the United States by 2030. To achieve that, it has said it wants to secure about 400 GWh of battery capacity.
On top of the two facilities announced in Indiana, Stellantis will build a gigafactory in Canada with South Korea’s LG Energy Solution 373220.KS (LGES).
In Europe, Stellantis has already inaugurated its first gigafactory in France, with two more to follow in Germany and Italy, all through its ACC joint venture with TotalEnergies and Mercedes, for a total capacity in the region of 120 GWh.
($1 = 1,340.6500 won)
(Reporting by Heekyong Yang and Joseph White; Additional reporting by Giulio Piovaccari and David Shepardson; Editing by Sharon Singleton and Mark Porter)
