Austin, Texas-baed battery maker Valence Technology, Inc. (NASDAQ: VLNC) has submitted an application under the U.S. Department of Energy’s Advanced Technology Vehicles Manufacturing Incentive Program (ATVMIP) for up to $608 million in low interest loans. The company wants to use the loans to help finance the construction of a new $760 million lithium iron magnesium phosphate battery manufacturing facility to be located in Central Texas.
If approved, it is anticipated that Valence’s U.S. production capacity would be online as early as 2011. This financing would allow the Company to construct a two-million-square-foot, vertically integrated manufacturing facility to manufacture and assemble finished batteries products. The facility would make the cathode material, build individual cells, and assemble packs and peripherals.
Valence said the new facility would meet the needs of the company’s growing customer portfolio, including automotive OEMs and Tier 1 suppliers from HEV (hybrid electric vehicles) to EV (electric vehicles) solutions.
Operating at full capacity, the domestic manufacturing facility would supply energy storage solutions for more than 250,000 hybrid and all electric vehicles annually. The facility would also supply energy storage solutions to the stationary power market, the industrial market and the U.S military.
“As an industry leader, we are well positioned to qualify for these loans as our technology and manufacturing processes are mature, proven and transferable,” said Robert L. Kanode, President and CEO of Valence. “We have been manufacturing in high volumes for the past four years at our Suzhou, China facilities and have been looking for an opportunity to expand into the United States. While we are currently supplying U.S. customers out of China, we would expect to be supplying the U.S. markets from a domestic facility by 2011, when the first phase of construction is completed.”
Valence said many companies are evaluating Valence energy storage solutions and some have selected Valence to be their system suppliers, including Brammo (electric motorcycle), Smith Electric Vehicles (delivery vehicles), Segway (personal transporter) and PVI (commercial electric trucks in partnership with Renault Trucks).
Chief Financial Officer Ross Goolsby said, “We are focusing on a facility in the Greater Austin area of Texas, which when it reaches full capacity, would provide up to 4,000 new jobs. We believe that Texas is a leading state in alternative energy and we have access to all the resources we will need to develop this facility.”
Valence currently has facilities in Nevada, China and Northern Ireland.
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