China’s Gotion High-Tech to Invest $6.5 Billion in Africa’s First Gigafactory

Chinese electric vehicle battery giant, Gotion High-Tech, has announced plans to invest over $6.5 billion in building the first gigafactory in Africa, located in Morocco. The announcement was made during the ongoing 2023 “GITEX Africa” event in Marrakesh, which focuses on showcasing technology and startup initiatives.

A Memorandum of Understanding was signed between Li Zhen, the chairman of Gotion High-Tech, and Mohcine Jazouli, the Moroccan Delegate-Minister to the Head of Government of Investment, Convergence and the Evaluation of Public Policies. The investment will break ground for Africa’s electric vehicle battery industrial ecosystem and generate more than 25,000 jobs.

The gigafactory will be constructed in the Rabat-Sale-Kenitra region, specifically in Bouknadel Commune. With an annual production capacity of 100 GW, the facility will manufacture batteries for electric vehicles and energy storage systems. 

Morocco, which is home to major vehicle factories operated by Renault and Stellantis, has seen rapid growth in its automotive industry and is projected to become the next country to achieve an annual production capacity of 1 million vehicles. Around 90% of the automotive production in the country is exported to over 75 countries worldwide.

The country’s position is further strengthened by its free trade agreements facilitating its exports with the United States, the European Union, and various other countries. The country also possesses significant mining resources, including manganese and cobalt, crucial elements in electric vehicle battery production.

Gotion High-Tech also has an EV battery plant planned at Mecosta County’s Big Rapids in Michigan. The state’s lawmakers recently approved the highly-contested $175 million incentive for the $2.4 billion project that would create 2,350 jobs in the area. Lawmakers voted 10-9 in favor of the approval with the 9 raising concerns about the company’s ties to China.

The battery manufacturer was established in China in 2006, but 26% of the company is owned by Volkswagen AG (ETR: VOW3), and its board is equal parts German, American, and Chinese.

Information for this story was found via AP News, North Africa Post, Reuters, and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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