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Detroit to offer $335m incentive to battery-makers

January 19th, 2009
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The beleaguered Detroit economy received a welcome boost at the Detroit Show when Michigan Governor Jennifer Granholm approved new legislation offering incentives to make batteries for electric cars in the state.

Michigan will offer refundable tax credits worth up to $335 million  to companies setting up R&D or manufacturing operations in Michigan to develop and build batteries for EVs and hybrids.

Granholm said she wanted Michigan to become “the battery capital of the world” - a lofty target given the dominance of Japanese, Korean and Chinese companies in the battery sector.

GM, Ford and Chrysler are all working on EV programmes, and US administrators fear that unless they stimulate the sector, all three will source from Asia. Earlier this week, GM signed a deal with LG Chem of Korea for the supply of batteries for its Chevrolet Volt EV.

Granholm toured the show on trade day, and was given demonstration rides in the Cobo Centre's basement, where a small test track has been installed – last year the area was filled with Chinese automakers and Tier 1 suppliers. The two Chinese automakers that attended the show were this year promoted to the main hall.

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