Granholm: Projects Creating Over 6,600 New Jobs Are Result of State's Efforts to Make Michigan Advanced Battery Capital of the World

Companies investing $1.7 billion

LANSING – Governor Jennifer M. Granholm today announced that Michigan’s aggressive effort to grow the advanced-battery industry and the jobs it will create has resulted in four companies announcing plans to invest more than $1.7 billion to launch advanced-battery manufacturing facilities in Michigan. The projects that will create 6,683 new jobs in Michigan were awarded state refundable tax credits that will help the companies in their quest for some of the $2 billion in federal grants for advanced-battery research and development.

The four projects announced today are:  Johnson Controls-Saft Advanced Power Solutions LLC, LG Chem-Compact Power Inc., KD Advanced Battery Group LLC, and A123Systems Inc.

“Today marks a defining moment for Michigan’s future as we see a new industry begin to take root and grow new jobs,” Granholm said. “Thanks to the most aggressive economic strategy of any state in the country, Michigan, the global center of automotive research and development, is positioned to lessen the nation’s dependence on foreign oil and become the advanced battery capital of the world.”

Facility locations will be determined pending final site selection decisions by the companies. Project details include:

• Johnson Controls-Saft Advanced Power Solutions LLC (JCS) – Milwaukee, Wisconsin-based JCS, one of the leading independent suppliers of lithium-ion batteries for hybrid and plug-in hybrid electric vehicles, plans to invest $220 million in a new advanced-battery manufacturing facility to produce lithium-ion cells for automotive applications. The project is expected to create 498 new jobs. Based on the Michigan Economic Development Corporation’s (MEDC) recommendation, the Michigan Economic Growth Authority (MEGA) board today approved a state tax credit valued at $48.5 million over 15 years and a battery cell state tax credit valued at $100 million over four years to help win the project over competing U.S. sites. JCS has partnered with Ford Motor Company on battery cell manufacturing, pack and system development, and integration capability. http://www.saftbatteries.com

“Johnson Controls has a long and proud history of manufacturing in Michigan. This plant is a demonstration of our commitment to our strong customer relationships there – particularly with Ford – as well as our nearly 10,000 dedicated employees.” said Alex Molinaroli, president of Power Solutions for Johnson Controls. “The Michigan facility is an important step in Johnson Controls’ plans to build a manufacturing infrastructure for hybrid and electric vehicles in the United States.”

• LG Chem-Compact Power – Korean-based LG Chem, in partnership with its U.S. subsidiary Compact Power (LGC-CPI) and General Motors, has proposed a plan to manufacture lithium-ion battery cells in Michigan. LCG-CPI plans to invest $200 million in the project, which is expected to create more than 300 new jobs. Based on the MEDC’s recommendation, the MEGA board today approved a state tax credit valued at $25.2 million over 15 years and a battery cell state tax credit valued at $100 million over four years to help win the project over competing U.S. sites. http://www.compactpower.com  

“We are delighted and honored that the state of Michiganhas approved our application for credits and also will be championing our application for federal incentives,” said Prabhakar Patil, CEO, Compact Power Inc. “We believe in the importance of localizing battery manufacturing in the U.S. and plan to do it in an orderly fashion. This announcement is a significant first step in ensuring that the future of lithium-ion battery manufacturing is located right here in the state of Michigan. It also further validates the viability of our technology and capability.”

• KD Advanced Battery Group LLC (KD) – The joint venture of The Dow Chemical Company, Kokam America Inc.,and Townsend Ventures LLC, formed to construct and operate a large scale battery and cell manufacturing facility in Michigan, plans to invest $665 million in a new 800,000 square-foot battery manufacturing facility to produce its patented Superior Lithium Polymer Battery technology for the electric and hybrid electric vehicle markets. The project is expected to create 885 new jobs. Based on the MEDC’s recommendation, the MEGA board today approved a state tax credit valued at $44.6 million over 15 years and a battery cell tax credit valued at $100 million over four years to help win the project over competing U.S. sites. http://dow.com http://www.kokamamerica.com

“This is an outstanding example of public-private collaboration done very well – the state of Michigan is facilitating growth to address critical needs: sustainable technologies and manufacturing prowess, all at an equally critical time,” said Heinz Haller, executive vice president, Performance Products, The Dow Chemical Company. “Dow is extremely proud to be working with the Michigan Economic Development Corporation on these important endeavors, and we are excited about the prospects of KD Advanced Battery Group, LLC.”

• A123Systems Inc. – The Watertown, Massachusetts-based designer, developer and manufacturer of rechargeable lithium-ion batteries and battery systems plans to invest over $600 million in initial coating, cell manufacturing, and pack assembly. The planned project is expected to create over 5,000 new jobs. Based on the MEDC’s recommendation, the MEGA board today approved a high-tech state tax credit valued at $25.2 million over 15 years and a battery cell state tax credit valued at $100 million over four years to help win the project over competing U.S. sites. A123Systems is one of the state’s six Centers of Energy Excellence and has entered into a development and manufacturing agreement with Chrysler LLC to provide battery systems for the company’s ENVI product line. http://www.a123systems.com

“Today is truly a milestone for A123Sytems, the state of Michigan and everyone interested in creating new markets where American innovation creates sustainable job growth in engineering, research and manufacturing,” said David Vieau, A123Systems’ president and chief executive officer.“ With the support of the state’s leadership and highly skilled workforce, we expect that our planned new facilities in Michigan will serve as a global product center, powering a new generation of cleaner, more fuel-efficient cars and trucks.” 

In January, Governor Granholm signed into law legislation that provided up to $335 million in refundable tax credits to encourage companies to develop and manufacture advanced batteries and commercialize advanced-battery technologies in Michigan. Last week, the governor signed legislation strengthening the law by adding an additional $220 million in tax credits available, bringing total incentives to $555 million. The initiative – the first of its kind in the United States – puts Michigan in prime position to compete for up to $2 billion in federal advanced-battery development grants.    

The MEGA board approved the first battery incentive agreements with Ford and GM in February, totaling $215 million for pack engineering, integration and assembly, vehicle engineering and advanced-battery technologies. 

“Thanks to a coordinated strategic plan driven by research and designed to leverage our strengths, we are now out in front of our competition to capture this market and create thousands of new jobs in Michigan,” MEDC President and CEO Greg Main said. “I want to thank Governor Granholm, our state legislators and our federal lawmakers for giving Michigan the tools we need to grow this industry and create jobs.”

About Michigan Economic Development Corporation (MEDC)

The Michigan Economic Development Corporation is the state’s marketing arm and lead advocate for business development, job awareness and community development with the focus on growing Michigan’s economy. For more information on the MEDC and our initiatives, visit www.MichiganBusiness.org. For Pure Michigan® tourism information, your trip begins at www.michigan.org. Join the conversation on: Facebook Instagram LinkedIn, and Twitter.