Accelera, Daimler and PACCAR JV will advance battery production

Zero-emissions business unit Accelera by Cummins, Daimler Trucks & Buses US Holding LLC (a Daimler Truck Group company) and Paccar, parent company of heavy-duty truck brands Kenworth, Peterbilt and DAF, announced they are partnering to accelerate and localize battery cell production and the battery supply chain in the U.S.

A planned joint venture between the companies will manufacture battery cells for electric commercial vehicles and industrial applications, with the total investment expected to be in the range of $2-$3 billion for the 21-GWh factory. The initial focus will be on lithium iron phosphate (LFP) battery technology for commercial battery-electric trucks, with the battery cells produced offering several advantages over other battery chemistries, the announcement stated, including lower cost, longer life and enhanced safety, without the need for nickel and cobalt raw materials.

Each of the three partners will maintain 30% ownership in the JV with joint control. China-based battery manufacturer EVE Energy will hold the remaining 10% ownership and serve as the technology partner, contributing its battery cell design and knowledge in the manufacture of LFP battery cells for the vehicle industry.

The partners anticipate growing demand for the technology throughout this decade as more commercial vehicle customers in North America take steps toward decarbonization. The JV will help create the necessary scale to enable these customers to more readily access cost-effective and differentiated battery cell technology, the announcement said.

The vision, added Preston Feight, Paccar CEO, is to provide “the highest quality, locally produced battery technology to enhance the operations of our customers and help them achieve their operational and environmental goals.”

Decarbonization in a way that best serves all stakeholders and the planet calls for working closely with key industry partners, said Jennifer Rumsey, Cummins Chair and CEO. “Today’s announcement reflects that action. Not only are we advancing a key technology solution for our customers, but accelerating the energy transition in the United States,” she noted.

Martin Daum, CEO of Daimler Truck, agreed, adding, “For Daimler Truck, partnerships and a strict focus on costs and smart capital allocation are the key levers to succeed on the path towards sustainable transportation. This planned joint venture enables economies of scale beyond Daimler Truck. It is a key puzzle piece of our battery industrialization strategy, ensuring access to the right battery cell technology at the right cost.”

The JV transaction is subject to customary closing conditions, and receipt of applicable merger control/regulatory approvals including the submission of a voluntary notice to the Committee on Foreign Investment in the United States (CFIUS).