The planned establishment of a battery plant for electric vehicles in the Czech Republic is almost a necessity for the domestic automotive industry due to market developments and Europe’s move towards low-emission sources.
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Today, Deputy Prime Minister Karel Havlíček (for YES) and CEO of ČEZ energy company Daniel Beneš signed a memorandum on support for the planned project. According to Havlíček, Volkswagen (VW), which also includes the Czech carmaker Škoda Auto, and the Korean LG are interested.
The Czech government approved the wording of the memorandum signed on Monday. The material available to ČTK shows that the investment should amount to at least 52 billion crowns in the first phase and that at least 2,300 new jobs are expected to be created in connection with it. A favorite for the construction of the so-called gigafactory is the area of the former brown coal power plant Prunéřov 1, which ČEZ shut down last year.
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“The establishment of at least one factory is a must if the Czech Republic wants to defend its position in the automotive industry. I perceive Volkswagen as a slight favorite, given its traditional ties to the domestic economy.
The Executive Director of the Association for Energy Accumulation AKU-BAT CZ, Jan Fousek, stated that the association very much welcomes the possible establishment of a gigafactory in the Czech Republic. “The European Commission has set itself the goal of increasing the sustainability of battery production and strengthening independence from the supply of raw materials for battery production from outside the EU. It is the increase in production capacity in Europe that brings us significantly closer to this goal,” he said.
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According to him, the project will have real added value only if the government and the investor succeed in creating the entire battery value chain – from the extraction of raw materials and their processing to secondary use and recycling. “There are many important experts in the field and scientists living in our country, and we have a great educational system. It would therefore be a great pity if the gigafactory became another Czech assembly plant,” said Fousek.
CEZ chief Beneš said today that a factory for batteries for electric cars could stand in the Czech Republic between 2026 and 2028 under an optimistic scenario. According to Fousek, the question is whether this is not too ambitious. “In comparison with the surrounding countries, where these factories are already being massively established, we should not run a train,” he added.
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According to the partner of the consulting company EY for the automotive industry Petr Knap, the memorandum signed today is a positive expression of government support and interest, which such a large potential investment deserves. “I believe that a decision will be made later this year,” he said. “Large investors will decide according to the overall conditions and the Czechia must present a comprehensively competitive offer,” he added.
Capitalinked.com economist Radim Dohnal thinks that the intention to get a battery factory to the Czech Republic is generally correct. “However, I would not do it, because in this way we support in people the feeling that the state will again arrange job opportunities and the direction of the country. It will be important to know how much investment support from the state budget will be,” he added. Beneš stated today that the amount of state support for the planned construction of the gigafactory has not been negotiated at the moment, and that, according to him, direct support and tax relief should form it.
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