The plant has a planned annual capacity of 22.3 GWh and is expected to be fully operational by the first half of 2023.

Chinese power battery suppliers are aggressively expanding production capacity at a time when the electric vehicle industry is growing rapidly.

Great Wall Motor-backed Svolt Energy announced Thursday that it has officially started construction of its power battery site in Yancheng, eastern China's Jiangsu province, with a planned annual capacity of 22.3 GWh.

Svolt Energy signed a contract with the local government two months ago for the project, which is planned to invest 10 billion yuan ($1.57 billion) and will use 873 acres (582,000 square meters) of land.

Svolt Energy begins construction of new $1.57 billion battery plant-CnEVPost

(Rendering of Svolt Energy's battery plant in Yancheng. Credit: Svolt Energy)

The company plans to build the plant in two phases and expects it to be fully operational by the first half of 2023, when it will become the core production base for the company's PHEV batteries and short-blade cells.

The project is an important part of the "SV '600' Strategy" and a key step in Svolt Energy's expansion into the Yangtze River Delta region, said Yang Hongxin, chairman and CEO of the company.

Svolt Energy begins construction of new $1.57 billion battery plant-CnEVPost

Svolt Energy announced its "SV '600' Strategy" on December 18, saying it aims to reach 600 GWh of battery capacity by 2025, nearly double its previous goal of 320 GWh.

Yang said at the time that total global demand for lithium batteries for electrification and energy storage in the transportation sector would exceed 1.8 TWh by 2025, and that the company aimed to capture 25 percent of the global market share.

Based on a 75 percent capacity utilization rate, Svolt is going to try to reach its goal of 600 GWh of global capacity, he said.

"In the face of the new cycle, Chinese companies must continue to stay ahead of the curve, with continuous innovation in technology and rapid ramp-up in capacity," he said.

Svolt Energy, a power battery company funded by Great Wall Motor in 2018, focuses on cobalt-free and solid-state battery research and development, and has established R&D centers in Japan, South Korea, the United States, India, Wuxi, Baoding and Shanghai.

The company currently has eight production sites with 297 GWh of capacity under construction, including 30 GWh of capacity being built in Europe.

In early August last year, Svolt Energy announced the completion of a Series B financing round totaling RMB 10.28 billion ($1.59 billion), led by Bank of China Group Investment Limited, with participation from Huaxing Growth Capital, a subsidiary of Chinese Renaissance.

Svolt Energy nearly doubles its battery capacity target to 600 GWh by 2025

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