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Mercedes-Benz Opens its New EV Battery Factory in Alabama as its Gets Ready to Build EQ Vehicles in the U.S.

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【Summary】Mercedes-Benz plans to start production of EQ electric vehicles in the U.S. in just a few months, so the company built an EV battery factory in Alabama to produce the batteries that will be installed in the vehicles. The new factory officially opened on Tuesday. The battery plant and vehicle assembly factory will make the state of Alabama an export hub for luxury electric vehicles SUVs.

Eric Walz    Mar 15, 2022 10:00 AM PT
Mercedes-Benz Opens its New EV Battery Factory in Alabama as its Gets Ready to Build EQ Vehicles in the U.S.

Automaker Mercedes-Benz plans to start production of EQ electric vehicles in the U.S. in just a few months, so the company built an EV battery factory in Alabama to produce the batteries that will be installed in the vehicles. The new factory officially opened on Tuesday.

The U.S. market is an important one for Mercedes-Benz. The battery plant and vehicle assembly factory will make the state of Alabama an export hub for luxury electric vehicles SUVs.

Mercedes-Benz will produce the new EQS SUV and EQE SUV in Alabama in the coming months and the state-of-the-art battery factory in Bibb County will provide batteries for the two electric SUVs. The EQ-badged family of Mercedes-Benz vehicles are all fully-electric. The automaker is accelerating the roll-out of its EQ models and will have nine fully electric EQ models on sale globally by the end of the year.

As part of the battery plant's opening, Mercedes-Benz unveiled interior photos of the EQS luxury-electric SUV for the first time. The automaker is emerging as a strong competitor to segment leader Tesla with its new EQ lineup of EVs. The EQS SUV will rival the Tesla Model X and other luxury EVs, including the Lucid Air sedan.

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The EQS SUV Interior.

The battery factory in Alabama is part of the automaker's global push to produce all-electric vehicles at seven sites across three continents as its prepares for its future plans to become an electric-only automaker by 2030.
"The opening of our new battery plant in Alabama is a major milestone on our way to going all-electric," said Ola Källenius, Chairman of the Board of Management of Mercedes-Benz Group AG. "With our comprehensive approach including a local cell sourcing and recycling strategy, we underline the importance of the U.S., where Mercedes-Benz has been successful for decades. We're proud to create new, future-proof jobs to build all-electric SUVs ‘Made in the USA' at a plant that is such an established part of our production family since 25 years."

The new battery plant will produce high-performance lithium-ion batteries for the EQS SUV and EQE SUV. The batteries are assembled on a production line around 300 meters long with more than 70 work stations. The entire production process will be CO2-neutral, according to Mercedes-Benz.

The battery cell assembled in Alabama will use an advanced cell chemistry containing nickel, cobalt and manganese in a ratio of 8:1:1. The automaker said it reduced the cobalt content of the batteries to around 10% to increase sustainability.

The battery plant will also employ a fully digitalized production process where a variety of components are combined, including up to twelve cell modules and "EE compartment", for the integration of the power electronics. 

The modular battery packs will be installed in the 7-passenger EQS SUV. The modular design is similar to the batteries used for the Mercedes EQS and EQE sedans

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Mercedes-Benz is also partnering with battery technology company Envision AESC at its factory in Bibb County. AESC will supply the automaker with high-performance battery modules from a new plant within the U.S. by mid-decade.

Once operational, the EV battery plant will create roughly 600 new jobs. Mercedes-Benz currently employs around 4,500 people in Alabama, plus an additional 11,000 jobs with its supplier network and service providers in the region, the company said. 

The new battery plant in Alabama will become part of the Mercedes-Benz global battery production network, which includes factories in Kamenz, Germany, Beijing China, Bangkok Thailand, Jawor Poland and Stuttgart, Germany. 

"The global Mercedes-Benz production network is digital, sustainable, efficient and flexible. Now the new battery plant, with its highly qualified and motivated U.S. workforce, will be a crucial driver of our electric vehicle roll-out plan," said Jörg Burzer, Member of the Board of Management of Mercedes-Benz Group AG, responsible for Production and Supply Chain Management. "Team USA will play a major role in the continued success of Mercedes-Benz and we are proud that our new electric SUVs will also be built here in Alabama for global markets." 

Mercedes-Benz has built vehicles in Alabama since the 1990s. Around four million vehicles have left its Tuscaloosa plant since 1997, with around 260,000 Mercedes-Benz SUVs rolling off the production line in 2021 alone for export around the world.

In total, roughly two-thirds of the vehicles produced in Alabama are exported, making Mercedes Benz one of the largest exporters of vehicles from the U.S. Now the plant will shift to building EVs, beginning with the all-new, electric EQS SUV, which will be officially unveiled on April 19.

Mercedes-Benz has invested a total of more than seven billion dollars in Alabama since the 1990s. Of this amount $1 billion was invested into the battery plant along with the logistics centers and to upgrade the production line to build EVs, according to the company.

The state of Alabama is emerging as a major region for auto production outside of Detroit and is the fourth biggest auto export state. In addition to Mercedes-Benz, automakers Hyundai Motor Co, Honda and Toyota produce over 1.3 million cars and light trucks each year in the state. 

The factories and Tier-1 suppliers support roughly 40,000 manufacturing jobs.

Beginning in 2025, all newly launched Mercedes-Benz vehicle architectures will be electric-only and customers will be able to choose an all-electric alternative for every model the automaker sells. Mercedes Benz is targeting a range of over 600 miles for its future EVs.

To reach its goal of electric only vehicles by 2030, Mercedes-Benz will invest heavily in R&D. In total, investments into battery electric vehicles between 2022 and 2030 will amount to over $47 billion. 

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