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Tesla may get $1.2 billion worth of German subsidies

The European Commission recently approved a multinational project to support battery innovation, which will involve 42 companies, including several automakers. One of those automakers is Tesla, which may receive a cool billion euros ($1.2 billion) in public funding from the federal government of Germany and the state of Brandenburg, the site of the company’s Gigafactory 4.

It’s not yet clear how much federal support Tesla will receive, and the final decision is expected to take several weeks. Other automakers that could receive state aid under the program include BMW, Stellantis (Fiat Chrysler) Rimac and Valmet. The government funding is expected to trigger at least three times as much in private investment.

The aim of the 2.9-billion-euro European Battery Innovation project is to help the EU to reduce battery imports from China, which currently controls some 80 percent of the world’s lithium-ion cell production. German Economy Minister Peter Altmaier said the program will create “the critical mass for the battery ecosystem in Germany and Europe.” According to the Commission, the value of Europe’s battery market is expected to reach 250 billion euros by 2025, and the continent hopes to be self-sufficient in batteries by that date.

Tesla plans to introduce a new structural battery design for Model Y at the German Gigafactory, and Elon Musk said in November that the carmaker will add a battery-cell production facility at the site. The initial capacity will be around 100 gigawatt-hours per year, and could eventually ramp up to as much as 250 gWh.

“I’m pretty confident at that point it would be the largest battery-cell plant in the world,” Musk said.

Source: Automotive News

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