German OEM Daimler’s subsidiary Li-Tec is to cease the production of lithium-ion batteries for electric vehicles (EV) at its plant in Kamenz, Germany, by the end of 2015.
According to the carmaker, the production of battery cells for electric and hybrid cars is not economical. “Our cells are very good, but at current production figures, far too expensive,” Harald Kröger, head of EV research at Daimler, told German media outlet Der Spiegel. “We have realised that a car manufacturer does not have to produce the cells themselves,” he added.
Daimler will retain the location as a research and development site and transfer most of the 250 Li-Tec employees to another subsidiary, Deutsche ACCUmotive. The battery pack producer is currently ramping up capacity to build systems for the upcoming electric smart model. LG Chem will supply the battery cells.
The Kamenz plant is the only lithium battery producer for electric cars in Germany. Daimler acquired Li-Tec in April this year.
The news comes after Continental announced to review its battery joint venture with SK Innovation last week.
Metalworker union IG Metall has called for an action plan from the German government and industry to maintain battery cell research and production in Germany after Daimler announced the production halt.
The German government plans to have 1m EV on German roads by 2020 to cut CO2 emissions by 40%.