Germany earmarks 1bn euros to produce battery cells


Germany will support three company alliances with earmarked funds of 1 billion euros for the domestic production of battery cells in an effort to reduce car makers’ dependence on Asian suppliers, Economy Minister Peter Altmaier told Reuters.

Among the more than 30 companies that applied for state funding at the German Economy Ministry are car makers Volkswagen and BMW, as well as German battery maker Varta and Swedish battery manufacturing startup Northvolt.

France and Germany have already asked the European Commission to approve state subsidies for a cross-border battery cell consortium including carmaker PSA, its German subsidiary Opel and French battery maker Saft.

“We’ve now reached a point where we can say that there is likely to be not only one battery cell consortium, but probably three,” Altmaier said in a Reuters interview.

The Economy Ministry will submit all necessary state aid documents to the European Commission once it has completed its selection process, Altmaier said.

The European Union allows state aid under certain conditions under its rules for Important Projects of Common European Interest (IPCEI).

Europe’s Energy Commissioners Maros Sefcovic and Competition Commissioner Margrethe Vestager have signalled support for the battery cell initiative.

“We hope that by the end of the year we will have clarity from Brussels,” Altmaier said, adding that the growing interest of the industry in the scheme showed that Berlin was right in pushing ahead with its new industrial policy plan.

Altmaier denied to comment on which companies have the best chances to get the earmarked state funds.

Northvolt and Volkswagen have said earlier this year that they are planning to set up a joint venture to build a battery plant in Salzgitter, Germany.

Suzan O