The Kentucky State Capitol, where Governor Andy Beshear recently announced Envision AESC’s decision to invest in Kentucky. [Image: Mobilus In Mobili/ Wikimedia Commons (CC BY-SA 2.0)]

Japanese Company Announces Plans to Open New Electric Vehicle Battery Plant in Kentucky

Japan Asia

The vehicle industry has become a key player as the world has sought newer, more sustainable energy sources to reduce reliance on fossil fuels. Electric vehicle (EV) sales have soared in recent years and it is predicted over half of all passenger-vehicle sales will be electric by 2035. Although the EV industry has traditionally been dominated by China, the United States has grown increasingly interested in developing its own EV industry. These efforts received a major boon on April 13, 2022, when Kentucky governor Andy Beshear announced Envision AESC, a Japanese EV battery manufacturer, will open a new battery manufacturing factory in Bowling Green.

Envision AESC’s investment in Kentucky will be one of the largest in the state’s history, estimated to be around $2 billion and to create 2,000 jobs for Kentuckians. Hailed by Governor Beshear as the second largest economic development investment in Kentucky history, the Kentucky state government sees the deal as a chance to cement Kentucky’s position as a leader in the vehicle industry at a time when interest in EVs is rapidly increasing. It is planned to open in 2025 and by 2027, it is expected to produce up to 300,000 EV batteries per year.

While Envision AESC’s decision to invest in Kentucky will have a major economic impact on the state, its implications for more renewable energy production are also significant. The Bowling Green plant will be powered by 100% renewable energy, which Governor Beshear says will ensure the plant will help drive progress towards decarbonizing Kentucky’s industrial sector. Envision AESC’s batteries produced in Kentucky will also have 30% more energy density than the current generation, making them more efficient and environmentally sustainable.

Envision AESC’s investment is just the latest in a long history of collaboration between Kentucky and Japan. Japanese-owned companies in Kentucky account for about 42% of all employment created by FDI in Kentucky, making Japan the state’s number one foreign investor. Japanese-owned companies have created roughly 47,000 Kentucky jobs, with investment especially common in the automobile and liquor industries. Toyota’s manufacturing plant in Georgetown, Kentucky is its largest vehicle manufacturing plant in the world, having produced more than 12 million vehicles since it opened in 1986. In the liquor industry, Kentucky bourbon has long been at the forefront of Kentucky-Japan collaboration, with some of the state’s most famous brands such as Jim Beam and Four Roses being subsidiaries of Japanese liquor companies. With this in mind, Envision AESC’s investment decision will only further strengthen an already robust relationship between Japan and Kentucky.

Michael Di Girolamo is a participant in the Young Professionals Program at the East-West Center in Washington. He is currently a first-year graduate student at the Johns Hopkins University School of Advanced International Studies.