TOKYO -- Nissan Motor will tie up with a Chinese-owned battery maker, investing over 200 billion yen ($1.8 billion) to build new battery plants for electric vehicles in Japan and U.K., Nikkei has learned.
The Japanese automaker will start turning out batteries at two new plants, one in Japan and one in the U.K., as early as 2024, aiming for total capacity sufficient to power 700,000 EVs per year.
While the auto industry is accelerating its shift to EVs, there is growing competition to invest in key components.
Envision AESC Group will operate the battery plants. Envision, in which Nissan holds a 20% stake, currently produces batteries sufficient to power 200,000 EVs. All the batteries produced at the plants will be supplied to the Renault-Nissan-Mitsubishi alliance.
Envision is the world's seventh-largest supplier of EV batteries. With the new factories in Japan and the U.K., the company aims to raise its capacity, turning out enough cells to power 900,000 EVs a year. Envision will also contribute funding for the plant. Nissan is considering joint investments and using subsidies from the Japanese and U.K. governments to help finance the project.
Nissan currently sells 180,000 electric cars a year. The company aims to raise that to more than 1 million cars by the end of 2023.
Nissan appears to be aiming to tie up with other leading battery manufacturers, including China's Contemporary Amperex Technology, or CATL, and South Korea's LG Chem to build new plants.
Global carmakers are rushing to build up the battery supply chain. In 2020, Toyota Motor set up a joint venture with Panasonic and has also partnered with CATL. Volkswagen is planning to build six battery plants in Europe by 2030. Ford Motor Company will partner with South Korea's SK Innovation, while General Motors, another U.S. automaker, has tied up with LG Chem to build plants in the U.S.