Home » AESC $1.6 Billion Battery Plant in Florence on Hold Due to Economic Concerns

AESC $1.6 Billion Battery Plant in Florence on Hold Due to Economic Concerns

Home » AESC $1.6 Billion Battery Plant in Florence on Hold Due to Economic Concerns

To keep us online
please subscribe for just $1.

🎉 Thank you for supporting us!
Subscribe

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In response to AESC’s decision, the South Carolina Fiscal Accountability Authority has rescinded $111 million in bonds that were allocated to support the expansion.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. 

Also Read California Flow Battery Energy Storage Project Developers Awarded $10M CEC Funding

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.

Also Read $500 Million Louisiana EV Battery Plant Construction Commences: The First of its Kind in the United States

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

Also Read Octopus Australia begins construction on Fulham Solar Farm and Battery project

Leave a Comment