Joint venture will precede shift to more electric commercial trucks, Cummins CEO says
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The CEO of Columbus-based Cummins says the newly announced joint venture to build a battery cell manufacturing plant is the first big investment in battery cells for commercial vehicles in the U.S.
The company’s zero-emissions business unit, Accelera by Cummins, is teaming up with three other companies for what is estimated to be a $2-3 billion investment that Jennifer Rumsey said will create a “significant number of jobs.”
While the joint venture still requires regulatory approvals, Rumsey said the companies are looking to get ahead of what will be a big shift toward electric commercial vehicles.
“It’s a pretty significant investment in this new plant,” Rumsey said. “That allows us to share that investment and create cells that we believe will have scale as the transition begins to occur, and then each of us can take those cells and design and produce battery packs.”
Accelera will have an equal 30% share in the joint venture with Daimler Trucks North America in Oregon and Washington-based Paccar. The venture’s technology partner, EVE Energy in Ohio, will have a 10% share.
Rumsey said with the need to invest in a range of battery-related solutions, companies are looking at ways to partner with others and share in that investment.
She said the commercial vehicle market requires a sense of cost efficiency as well as life and durability requirements for battery cells. That’s why the joint venture plans to develop lithium-iron-phosphate, or LFP, batteries for commercial battery-electric trucks.
“We believe [these batteries] will have a cost advantage because of the chemistry that doesn’t rely on some of the harder-to-come-by metals as well as the design of the cell and how that integrates into the pack,” she said. “It’ll be lower cost and it has twice the life cycles of a NMC, which is another common chemistry that’s used in passenger cars.”
But will the new manufacturing plant be located in Indiana? Rumsey said the partners are in the final stages of evaluating several sites across the U.S. However, she added regardless of where the plant is built, it will support operations in Indiana.
“We are today at Accelera by Cummins, making battery packs in our plant here in Columbus, Indiana, and that business is going to grow over time,” she said. “For Cummins, it’s relatively small today, because these technologies are just starting to be adopted, [but] we’re projecting it’ll grow to $6-13 billion by 2030. And so there’s a lot of opportunities to grow, and these battery cells will play a role in creating jobs here in Indiana, for sure.”
The joint venture aims to begin production in 2027. When at full capacity, Rumsey said the plant will be able to produce 21 gigawatt hours of battery cells.