A division of Korean conglomerate SK Group broke ground Tuesday on a sprawling factory to supply batteries for electric vehicles.
The deal is expected to bring 2,000 jobs to Jackson County, northeast of Atlanta, making it the largest economic development deal in Georgia since Kia Motors opened in West Point a decade ago.
The nearly $1.7 billion factory, which will open in phases and is expected to reach its full jobs potential by 2025, is a coup for Georgia. The facility will be on the leading edge of the electrification of new automobiles for decades to come.
The SK Battery America plant is expected to produce batteries to power 250,000 electric vehicles per year at full capacity.
It also comes as the Sun Belt continues to grow as a leading hub of automotive production and as Georgia has sought to woo automakers and their suppliers to open factories and bolster the economic prospects of the state’s rural communities.
The plant will build batteries for electric Volkswagen vehicles to be produced in Chattanooga. Initially, it will have a production capacity of 10 gigawatts — a measurement that denotes the total power capacity of the batteries expected to be produced each year, said Jun Kim, president and CEO of SK Innovation.
“Volkswagen is doing business in Tennessee; Alabama is home to companies like (Mercedes-Benz parent company) Daimler and Hyundai,” Kim said. “South Carolina also has facilities for Daimler, Volvo and BMW; and there is Kia Motor Co. in Georgia as well. Slightly up north, there are other companies like Ford. This is where the demand is concentrated.”
Gov. Brian Kemp hailed the factory for creating jobs that will keep locals in their communities.
“It’s not only an exciting day for all of us here but it’s an exciting day for all hardworking Georgians out there for the opportunities they’ll see in the future,” he said.
SK, which makes lithium-ion batteries for hybrid and fully electric automobiles, announced its planned factory in November, during the closing weeks of then-Gov. Nathan Deal’s second term. The project will rise in an industrial park along I-85 in Commerce, about 65 miles northeast of downtown Atlanta.
Georgia lost its domestic automotive plants more than a decade ago when Ford closed its Hapeville assembly plant in 2006 and General Motors shuttered its Doraville factory in 2008. But that hole is being filled by foreign automakers and suppliers across the South, seeking a supply chain and production foothold in the world’s second largest automotive market and to temper the ups and downs of global trade.
In the past few years, auto manufacturing has shifted to the South.
And while rival southern states, including South Carolina, Tennessee and Alabama, might boast more automotive manufacturing centers, but Georgia has landed several critical suppliers and the North American headquarters for luxury brands including Porsche and Mercedes-Benz.
Since 2009, Kia has taken root in West Point making Sorrento SUVs and Optima sedans. Porsche took a portion of the former Ford factory near Hartsfield-Jackson International Airport and turned it into its North American corporate campus – complete with a test track.
Mercedes-Benz, meanwhile, recently opened a glistening North American headquarters of its own in Sandy Springs, where it employs more than 1,000. Groupe PSA – maker of Peugeot and Citroen automobiles – doesn’t currently sell cars in America, but in 2018 the company announced Atlanta as its corporate beachhead for renewed operations in North America.
More than 27,800 Georgians work in the automotive industry, according to the state Department of Economic development.
As domestic and foreign automakers electrify more of their fleets, the potential for battery production is huge, officials said. Representatives of automakers including BMW, Ford and Volkswagen attended today’s event.
“I am confident that Georgia will be the center of the battery industry for electric vehicles in the world,” SK Group Executive Vice Chairman Jaewon Chey said.
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