New Joint Venture Truck, Bus Battery Plant Expected to Launch in 2027

September 12, 2023

Stock image of a lithium iron phosphate battery cell for an electric vehicle.

A 21-gigawatt-per-hour battery cell factory being created under a joint venture of Cummins, Daimler Trucks and Paccar could eventually provide enough energy to drive the entire North American commercial truck and bus market.

That is one analyst’s prediction of the plant being developed by the three companies, which announced the partnership last week to accelerate and localize battery cell production in the U.S. The plant is expected to be fully operational in 2027.

The joint venture will reportedly manufacture battery cells for electric commercial vehicles and industrial applications, as well as create manufacturing jobs. Total investment is expected in the $2 or $3 billion range.

Jamie Fox, a principal analyst at Interact Analysis, added that a 21 GWh plant operating at full capacity in 2028 “would amount to around a 40 percent share of all-electric buses and medium and heavy trucks, assuming 22 percent of trucks are electric in that year.”

He added that the share would be much lower if battery production extends to light-duty trucks or if the plant also targets international markets.

In a statement sent to School Transportation News, Daimler Trucks said that the first battery cells are to be produced for vehicles in North America, with production scheduled to start in 2027. The location of the plant has yet to be announced at this report.

A representative from Daimler Truck North America added that the partners are working diligently to find the optimal site to establish the battery cell manufacturing plant. “The team has followed a rigorous process to narrow the list of states and sites to a few locations that meet our needs, avoiding sensitive geographic locations for CFIUS considerations, and is working through the final selection process,” the representative continues. “We anticipate announcing the final site within approximately the next six months.”

“We, Paccar and Cummins believe that this [joint venture] will enable us to build a battery cell factory in the U.S. that is focused on the specific requirements of commercial vehicles,” the statement from Daimler reads. “Creating economies of scale in battery cells optimized for commercial vehicles combined with localizing the supply chain in North America will better serve our customers. Bundling our battery volumes lowers the cost of batteries and supports the wider adoption of BEVs in heavy vehicles.”

Daimler added that the JV does not impact current partnerships, “as they continue to play an important strategic role in Daimler Truck’s battery and battery cell supply strategy.”

Cummins’ zero-emissions business unit Accelera, Daimler Truck and Paccar will jointly control and each own 30 percent of the new factory, which will initially focus on manufacturing lithium-iron-phosphate (LFP) battery technology or commercial battery-electric trucks. LFP battery cell manufacturer EVE Energy will serve as the technology partner and will retain 10 percent ownership. A press release stated EVE Energy will contribute its industry-leading battery cell design and manufacturing know-how.