Two Chinese Battery Parts Firms to Build Factories in U.S. as Tariffs Soar

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Shenzhen Capchem Technology Co. plans to invest $350 million to build a plant in Louisiana.

As the United States raises tariffs on Chinese-made batteries and parts, two Chinese lithium battery parts manufacturers have announced plans to build factories in America.

Capchem Technology USA Inc., a wholly owned subsidiary of Shenzhen Capchem Technology Co. Ltd., said Tuesday that it plans to invest $350 million to build an integrated carbonate solvent and lithium-ion battery electrolyte manufacturing facility in Louisiana.

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Two Chinese lithium battery parts manufacturers, Capchem Technology USA Inc. and Kedali Industry Co. Ltd., announced plans to build factories in the U.S.
Capchem will invest $350 million in Louisiana and $120 million in Ohio, while Kedali will invest $49 million in Indiana.
These investments come in response to the U.S. raising tariffs on Chinese-made batteries and parts, with tariffs on some items increasing from 25% to 100%.

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Who’s Who

Shenzhen Capchem Technology Co. Ltd.: Shenzhen Capchem Technology Co. Ltd. is a Chinese company whose subsidiary, Capchem Technology USA Inc., plans to invest $350 million in a manufacturing facility in Louisiana for carbonate solvent and lithium-ion battery electrolyte. The project has received significant local government subsidies, including a 10-year $71.3 million tax break. Capchem also plans to invest $120 million in a battery chemicals production base in Ohio.

Kedali Industry Co. Ltd.: Shenzhen-based Kedali Industry Co. Ltd. recently announced plans to invest $49 million to build a plant in Indiana. The company specializes in precision structural parts for power batteries. Unlike larger battery firms, Kedali, as a medium-sized manufacturer, has more flexibility and lower opportunity costs, making it advantageous for entering the U.S. market. They are pursuing this investment through their local subsidiary to meet regulatory requirements and create jobs.

Contemporary Amperex Technology Co. Ltd.: Contemporary Amperex Technology Co. Ltd. (CATL) is a Chinese battery giant involved in a $3.5 billion battery plant project with Ford Motor, called BlueOval Battery Park Michigan. Despite using CATL’s technology through a license agreement, the project has faced challenges, including opposition from Republican chairs of two U.S. House committees, causing work stoppages before it resumed in November 2023.

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