Solus Advanced Materials to build new factory in Quebec

Solus Advanced Materials, which supplies electric vehicle battery materials to Tesla, will break ground on a new factory in Quebec, Canada, in July, the company said Monday.

Once completed, the Quebec facility will begin the mass production of copper foils of up to 17,000 tons starting the second half of 2024. The annual production capacity could potentially expand up to 60,000 tons.

Formerly known as Doosan Solus, the South Korean company manufactures copper foils that go inside EV batteries. The firm will supply 70 percent of its copper foils for the 4680 battery cell, to be directly manufactured by Tesla.

The 4680 battery cell is the next-generation EV battery unveiled by Tesla in 2020. The new cell is six times more powerful, stores five times more energy, and offers a 16 percent longer driving range. It is also 14 percent cheaper than Tesla’s previous EV battery, the 2170 battery cell.

Tesla aims to get 70 percent of its 4680 cell supply from Japan’s Panasonic and produce 30 percent of them on its own. Tesla announced last week that it successfully produced 1 million 4680 cells at its pilot production facility in California.

“The new factory will allow Solus Advanced Materials to benefit from the United States-Mexico-Canada Agreement and take initiative in the North American market,” a company official said.

Under the USMCA, which took effect in 2020, vehicles must contain 75 percent of components produced locally in North America -- including batteries -- or they will face tariffs in the region starting in 2025. Solus Advanced Materials’ Canadian-produced copper foils are expected to help Tesla to avoid the USMCA tariffs.

By Kim Byung-wook (kbw@heraldcorp.com)