Construction at the AESC Florence Battery Plant expansion project remains in a paused but active state as of 2026, following a mid-2025 suspension triggered by policy uncertainty, tariffs, and evolving U.S. EV incentive frameworks. Despite the halt that was implemented after more than $1 billion had already been invested and major structural works largely completed, the South Carolina EV battery project is now the subject of advanced restart discussions between AESC, government stakeholders, and industry partners. There is also strong indication that construction could resume once policy clarity improves.
The facility is designed to supply next-generation battery cells to BMW’s U.S. electric vehicle operations. It also continues to be viewed as one of the critical links in the company’s U.S. domestic EV supply chain, even as interim supply is sourced from AESC’s global network. The independence and domestication of U.S. supply chain has also been at the center of many recent industrial investments including those focused on renewables such as solar PV manufacturing plants.
The AESC battery plant in Florence will also deliver next-gen battery cells with 20% higher energy density and 30% improved efficiency. In addition to the technical gain, it also anchors BMW’s “local-for-local” EV strategy in North America.
Additionally, the initial AESC battery plant in Florence, South Carolina continues to progress with construction since its groundbreaking in 2023. Major civil works have also been largely completed. The facility, designed as a 30 GWh gigafactory, will supply cylindrical lithium-ion cells to BMW. It originally targeted production start in 2026 – and this still remains the case. Despite the progress, that timeline now under pressure due to the expansion project pause in mid-2025. The original plant, however, continues to scale development viably into completion.
Project Team
Developer and Owner: AESC Group
Customer: BMW Group (Neue Klasse EV platform supply chain)
Government and Economic Partners:
- State of South Carolina
- South Carolina Department of Commerce
Supply Chain Ecosystem:
- BMW Spartanburg Plant in vehicle manufacturing
- BMW Woodruff in battery assembly
- AESC global manufacturing network offering interim supply support
AESC $1.6 Billion Battery Plant in Florence on Hold Due to Economic Concerns
Reported June 18, 2025 – In a significant development for South Carolina’s electric vehicle (EV) industry, Japanese battery manufacturer AESC has announced a pause in the expansion of its Florence-based EV battery plant. The decision stems from prevailing market uncertainties, including potential changes to federal EV tax credits and tariff policies. Originally, AESC planned a $1.5 billion investment to construct a second facility adjacent to its initial plant, aiming to create over 1,000 additional jobs. However, the company has now halted these expansion plans, citing the need for a more stable policy environment.
State Withdraws $111 Million in Bonds Following Project Delay
In response to AESC’s decision, the South Carolina Fiscal Accountability Authority has rescinded $111 million in bonds that were allocated to support the expansion. These funds were intended for infrastructure improvements, site preparation, and the development of a training center. Governor Henry McMaster described the withdrawal as a responsible move, emphasizing the importance of prudent financial management in light of the project’s indefinite timeline.
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Initial Facility Remains on Track for 2026 Completion
Despite the pause in expansion, construction of AESC’s initial facility in Florence continues as planned. The $1.6 billion plant is expected to commence operations in 2026, employing approximately 1,620 workers. This facility will produce advanced lithium-ion battery cells for BMW’s Spartanburg assembly plant, contributing significantly to the region’s economic growth and the broader EV market.
Community Leaders Focus on Infrastructure Amid Expansion Delay
Local officials view the expansion delay as an opportunity to address existing infrastructure and housing challenges in Florence County. Efforts are underway to improve transportation networks and develop residential areas to support future industrial growth. The community remains optimistic that, once market conditions stabilize, AESC will resume its expansion plans, further solidifying Florence’s role in the EV industry.
AESC Battery Plant, Florence Overview
Project Name: AESC Florence Battery Gigafactory
Location: Florence County, South Carolina, USA
Company: AESC (Automotive Energy Supply Corporation), a global leader in EV battery technology
Total Investment: $1.6 billion
Facility Size: Approximately 1.5 million square feet
Site Area: 870 acres within the Technology and Commerce Park
Production Capacity: 30 GWh per year
Primary Client: BMW Group’s Plant Spartanburg, supplying advanced battery cells for next-generation electric vehicles
Job Creation: 1,620 new high-value jobs
Construction Timeline:
Groundbreaking: June 2023
Original Completion Target: 2026
Current Status: Construction paused as of June 2025 due to policy and market uncertainties
Design and Construction:
Design Initiation: Early 2023
Estimated Completion: Originally set for 2025
General Contractor: Clayco
State Support and Incentives:
Total Incentives Offered: Over $255 million
Florence County Support: $135 million for project costs
State Support: $120 million for off-site infrastructure, training facilities, and site preparation
Incentives Adjustment: $111 million in bonds withdrawn following construction pause
Sustainability Initiatives:
Facility to be powered by 100% net-zero carbon energy
Commitment to responsible sourcing of critical battery components (cobalt, lithium, nickel)
Integration of renewable energy generation and battery recycling processes
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