Latest news with #AdvancedManufacturingProductionCredit
Korea Herald
2 days ago
- Automotive
- Korea Herald
Posco Future M starts supply of Korea-made battery precursors to US Ultium Cells
Posco Future M completed its first shipment of Korean-made cathode materials to the US for Ultium Cells — a battery joint venture between LG Energy Solution and General Motors — qualifying the batteries for US electric vehicle energy tax credits. Cathode materials are a key component of EV batteries, directly influencing the cells' overall capacity, energy density and safety. This milestone marks the first time cathode materials, previously heavily reliant on China, have been manufactured entirely with Korean-sourced materials. High-nickel, cobalt, manganese and aluminum cathode materials are known for high energy density and output. Although details on the supply volume remain undisclosed, the NCMA materials will be used in high-performance EV batteries manufactured by Ultium Cells to target the US, the world's second-largest EV market after China. The cathode materials, shipped on July 26, were produced using precursors from a newly completed plant in Gwangyang, South Jeolla Province, which boasts an annual capacity of 45,000 units. These precursors, made from nickel, cobalt and manganese, were then combined with lithium to create the final product. With this initial shipment, Posco Future M also plans to expand production at its Pohang plant in North Gyeongsang Province. 'While these products remain subject to the 15 percent US tariff on Korean imports, the impact can be offset by the Advanced Manufacturing Production Credit under the US Inflation Reduction Act,' said a source familiar with the matter on condition of anonymity. Under the IRA, which incentivizes US production of key battery and clean energy components, EV battery manufacturers are eligible for an AMPC credit of up to $35 per kilowatt-hour for battery cells and up to $45 per kilowatt-hour for battery modules. The credit is available for production and sale through 2031, having been recently moved up by one year. The cathodes produced by Posco Future M meet the IRA regulations that require battery components to be manufactured within the US or in a US FTA partner country such as Korea. On the other hand, battery makers using Chinese-made cathodes are ineligible for AMPC incentives, as the recently enacted One Big Beautiful Bill Act classifies China as a 'Prohibited Foreign Entity.' Posco Future M stated, 'Our self-sufficient supply chain is expected to provide a significant competitive advantage over competitors, even in the face of shifting geopolitical dynamics.' In June, Posco Future M, along with Posco Group affiliates, including Posco, Posco HY Clean Metal, Posco Pilbara Lithium Solution and Posco Lithium Solution, established a fully integrated supply chain that spans from raw materials such as lithium and nickel to precursors and cathode materials. Meanwhile, Posco Future M is also intensifying its efforts to reduce dependence on China, particularly in the graphite supply chain. The company is developing natural graphite anode materials by securing graphite ore from non-Chinese sources, such as African countries, while promoting raw material localization through domestic production of intermediate spherical graphite.
Korea Herald
17-07-2025
- Automotive
- Korea Herald
SK On signs lithium deal with EcoPro to boost IRA compliance
SK On signed a lithium hydroxide supply agreement with EcoPro Innovation on Wednesday, ramping up efforts to strengthen its domestic EV battery supply chain in line with the US Inflation Reduction Act requirements. Under the deal, SK On will receive up to 6,000 metric tons of domestically produced lithium hydroxide by the end of this year, enough to power approximately 100,000 electric vehicles. The lithium will be processed through domestic cathode plants before being shipped to SK On's US battery facilities. Lithium hydroxide, a critical ingredient in nickel-cobalt-manganese cathodes, has traditionally been sourced from overseas, mostly from China. By securing domestic materials, SK On aims to enhance price competitiveness and reduce geopolitical risk. Notably, Korean-made lithium hydroxide qualifies under the IRA's Advanced Manufacturing Production Credit, helping SK On secure tax credits and improve cost efficiency in the US market. EcoPro Innovation CEO Kim Yoon-tae said the deal marks their first lithium hydroxide supply to a global battery maker and will help expand their presence in North America and Europe. 'We're building a stable supply chain amid shifting global policies,' said Park Jong-jin, head of strategic purchasing at SK On. 'Securing competitive materials and diversifying partners will boost our North American capabilities.'
Chicago Tribune
08-07-2025
- Automotive
- Chicago Tribune
Controversial Ford battery plant ‘on track' to remain eligible for key federal support
WASHINGTON — Ford Motor Co. confirmed Tuesday that its multibillion-dollar battery plant in south-central Michigan remains 'on track' to qualify for a crucial federal tax credit, despite new federal restrictions on sourcing from China. 'Ford is committed to making the best, most cost-effective batteries for the next generation of electric vehicles in the United States,' company spokesperson Robyn Jackson said in a statement. 'BlueOval Battery Park Michigan is on track to qualify for the production tax credit — a win for our customers and a win for American competitiveness.' The Marshall, Michigan, plant has been controversial because of Ford's agreement to license technology from Chinese battery giant Contemporary Amperex Technology Co. Ltd. at the new facility, an arrangement that sparked backlash and threatened business plans with some 60% of construction complete. The new federal restrictions came via Republicans' One Big Beautiful Bill Act, a massive tax cut and spending package that President Donald Trump signed into law over the weekend. An earlier U.S. House version of the bill would have torpedoed Ford's eligibility for the federal Advanced Manufacturing Production Credit, but an all-out lobbying effort helped the Dearborn-based automaker secure favorable changes in the U.S. Senate. The credit in question, also known as the 45X credit, targets battery producers and upstream industries. Battery cells, which store and release energy needed to power EVs, are each eligible for a credit of $35 per kilowatt-hour of energy they can store and $10 per kilowatt-hour for battery modules or pack assembly. The Marshall plant's capacity is 20 gigawatt-hours per year. Ford's company statement uses careful language to describe its tax credit status, as the U.S. Department of the Treasury still needs to finalize implementation guidelines based on the congressional directive. Those guidelines will more firmly determine the plant's eligibility. Ford CEO Jim Farley has called the credit 'critical for our industry,' but the House bill explicitly excluded components made as a product of licensing agreements with prohibited foreign entities — a designation that applies to CATL. The final Senate version removed that language. Ford Executive Chairman Bill Ford originally said ineligibility of the production tax credit would 'imperil' the $3 billion plant expected to create 1,700 jobs. Lisa Drake, Ford's vice president of technology platform programs and EV systems, later clarified that the automaker planned to 'stick behind' Marshall, but said losing the credit could delay production and hiring. The executives underscored that if EVs are going to be affordable, the company needs the advanced Chinese battery technology, and if it cannot build those cells economically in the United States, it will have to source from elsewhere. Tesla Inc. has bought CATL's lithium-iron-phosphate batteries made in China for U.S. EVs. Detroit-based General Motors Co. plans to do so, as well, until it can domestically produce lithium manganese-rich batteries, a technology Ford also is developing.
Korea Herald
07-07-2025
- Automotive
- Korea Herald
LG Energy Solution returns to profit in Q2 on strong US demand
LG Energy Solution said Monday that it posted a profit in the second quarter of this year, primarily driven by its stellar performance in electric vehicle and energy storage systems in the North American market. According to the company's preliminary earnings, from April to June, its operating profit skyrocketed 152 percent to 492.2 billion won ($360.5 million), while sales revenue slipped 9.7 percent to 5.56 trillion won from the previous year. This figure marks the first time in six quarters that LG Energy Solution has recorded a profit when not including financial benefits from the Advanced Manufacturing Production Credit outlined in the US Inflation Reduction Act. The company posted an AMPC-excluded profit of 1.4 billion won in the second quarter. 'Several key factors have contributed to the increase in profit, including rising demand for highly profitable battery products from North American clients, local ESS production in North America and ongoing cost-saving efforts,' said an industry source familiar with the matter, on condition of anonymity. LG Energy Solution signed an agreement with the US-based Delta Electronics to supply 4 gigawatt-hour battery cells for ESS applications, enough to power 400,000 US households for a day. The company began mass production of lithium iron phosphate (LFP) pouch cells at its Michigan plant last month, marking the first instance of a global battery manufacturer starting large-scale LFP battery production for ESS within the US. However, the source noted that sales declined during the same period, partly due to conservative inventory management by European automakers and a drop in production volume in China. This adjustment was a strategic move to minimize exposure to US tariffs on Chinese-manufactured ESS products. As part of its cost-reduction strategies, the battery maker decided to suspend the planned ESS investment in Arizona and instead utilize the Michigan plant earlier in the year. In response to a downturn in the global EV industry, the company also acquired a third joint venture plant with General Motors in Michigan to address the EV battery demand initially intended for LG's Michigan facility. 'We are aware of the increased external volatility from major US policy changes, which makes it challenging to predict market demand,' stated LG Energy Solution in a press release. 'However, we consider the initiation of mass production for new battery chemistry products targeting European EVs and the full-scale ESS production in North America as key opportunities to improve our earnings in the latter half of this year.' Industry insiders suggest that the recent passage of Donald Trump's 'One Big Beautiful Bill' is expected to have a limited impact on Korean battery companies such as LG Energy Solution. This is because the AMPC is set to conclude at the end of 2031, only a year earlier than originally planned. On the other hand, the $7,500 consumer tax credit for new EV purchases under the IRA has been accelerated to this September from the end of 2032.
Miami Herald
25-06-2025
- Business
- Miami Herald
Huge solar equipment manufacturer files for Chapter 11 bankruptcy
The U.S. solar energy industry has faced many of the same economic issues that other retail and manufacturing industries have dealt with, including rising labor and product costs driven by inflation, higher interest rates on debt obligations, and extreme competition from across the world. Some economic factors unique to the solar industry, however, threaten to put some companies out of business. Don't miss the move: Subscribe to TheStreet's free daily newsletter The solar industry may face a potential revenue disaster if Congress follows through with proposals to phase out or eliminate tax credits for developers of renewable energy products and manufacturers of renewable energy technology. Related: Popular children's retailer files for Chapter 11 bankruptcy The Inflation Reduction Act of 2022 implemented the Advanced Manufacturing Production Credit in IRC Section 45X, which provides lucrative tax credits for eligible components produced or sold between Jan. 1, 2023, and Dec. 31, 2032. The tax credits will provide billions of dollars of tax benefits for developers and manufacturers of solar equipment if fully implemented. Congress, however, might snuff out that lucrative tax benefit for solar equipment manufacturers if new legislation is signed into law. The U.S. House of Representatives on May 22, 2025, passed its version of the budget reconciliation bill, HR 1, President Trump's One Big Beautiful Bill Act, which includes proposed revisions to the existing law that would phase out or eliminate the IRC Section 45X tax credits. The tax credits are still in limbo as the U.S. Senate is still deliberating on HR 1, trying to reconcile its version with the House version. Eliminating the Section 45X tax credits may force several solar equipment companies out of business, putting thousands more workers in the unemployment line. One company has been pushed over the edge by just the threat of tax credits disappearing. Major solar energy equipment manufacturer Meyer Burger Holding Corp. filed for Chapter 11 bankruptcy, seeking a sale of its assets and to halt a Worker Adjustment and Retraining Notification Act lawsuit after abruptly closing its Arizona plant. Related: Another national retail chain files for Chapter 11 bankruptcy The Goodyear, Ariz.-based debtor, which is a subsidiary of parent company Meyer Burger AG of Switzerland, filed its petition in the U.S. Bankruptcy Court for the District of Delaware on June 25, listing $100 million to $500 million in assets and about $560 million in debts. The debtor owes about $89 million from a secured bridge loan, about $370 million in unsecured intercompany loans, and about $100 million in unsecured trade payables and other unsecured debts. More bankruptcy: Iconic auto repair chain franchise files Chapter 11 bankruptcyPopular beer brand closes down and files Chapter 7 bankruptcyPopular vodka and gin brand files for Chapter 11 bankruptcy The debtor will seek debtor-in-possession financing, which includes a roll-up of preparation secured debt, and a bidding procedures motion with a stalking-horse bidder offer to purchase the company in a Section 363 sale, according to court papers. The debtor said financial and operational setbacks from an inundation of the global solar market with low-priced Chinese products and debilitating trade restrictions affected the European market and prompted the debtor to expand into the U.S. solar market with the opening of an Arizona solar module plant. The debtor faced financial issues related to its Arizona solar module manufacturing facility, as the plant's production line design didn't meet the intended solar module design, requiring a six-month delay and redesign of the production lines. The Arizona facility cost $60 million and 12 months to complete and was expected to produce 10,000 solar modules a day and employ 600 workers. The facility, however, consists of two partially installed production lines that never reached full production capacity, and a third line installation was delayed because of a shifting business plan and deteriorating financial condition. A planned Colorado Springs, Colo., solar cell manufacturing facility was discontinued due to the company's inability to obtain necessary financing. Meyer Burger was unable to secure adequate financing to complete construction of the Arizona module plant and the Colorado cell facility, and its affiliates in Switzerland and Germany were forced into insolvency proceedings. The company also faced economic issues from global supply chain disruption. At full capacity, the company expected to generate almost $1.3 billion in tax credits through the Inflation Reduction Act of 2022, but production setbacks significantly reduced the company's benefit. Congressional plans to phase out or eliminate the tax credits caused uncertainty with lenders and investors, which impacted the company's out-of-court restructuring and recapitalization plans. After an investor terminated a restructuring and recapitalization deal at the beginning of May 2025, manufacturing challenges and macroeconomic headwinds forced the debtor to lay off all 400 employees at the Arizona plant and shut down production by May 31, 2025. The shutdown prompted former employees to file a class-action lawsuit alleging the company violated the Worker Adjustment and Retraining Notification Act. The debtor's Chapter 11 filing placed an automatic stay on all litigation while the bankruptcy case proceeds. Related: Popular bar and grill chain files for Chapter 11 bankruptcy The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
