Samsung SDI, Stellantis choose Indiana for second joint EV battery plant

A worker enters The Samsung SDI battery factory in God, Hungary, December 12, 2022. REUTERS/Marton Monus/File Photo

SEOUL (Reuters) - Stellantis and South Korea's Samsung SDI Co Ltd said on Wednesday they will build a second electric vehicle battery plant in Kokomo, IN, 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.

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 and Ford 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 last 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.

Last month, Samsung SDI 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, 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 U.S. by 2030. To achieve that, it has said it wants to secure about 400 GWh of battery capacity.

($1 = 1,340.6500 won)

(Reporting by Heekyong Yang; Editing by Sharon Singleton)

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