Tesla CEO Elon Musk's announcement that the firm is planning to build a battery 'gigafactory' confirmed something we all knew would happen eventually--more electric cars means greater demand for batteries.
U.S.-founded battery firm Boston-Power knows this too, and plans to expand its own operations following a rumored $250 million investment from China.
[UPDATE: After publishing this article, Green Car Reports was contacted by Darren Bischoff of Boston-Power, who noted that last Friday's article on Dow-Jones VentureWire stated that Boston-Power is close to achieving new funding.
"The reporter did not say that it had closed financing," he wrote, "nor did Boston-Power did not issue a press release about completing a round of financing."
We have edited this article accordingly.]
Boston-Power goes way back, and has previously dabbled in electric vehicle batteries--it supplied Saab with batteries for its electric 9-3 ePower, long before the Swedish firm's collapse and subsequent revival under Chinese-Swedish firm NEVS.
The firm started in Massachusetts in 2005, writes The Wall Street Journal. Unlike Tesla Motors however, Boston-Power failed to secure funding from the U.S. government to open a large-scale battery factory in the U.S.
Instead, it sought investment from China, raising more than $100 million from GSR Ventures, and moved most of its operations to China.
Boston-Power currently has annual capacity of 300 megawatt-hours at its Chinese plant, and has a foot in the door of the automotive market supplying batteries to the Beijing Electric Vehicle Company.
MORE: Tesla's Lithium-Ion Battery Gigafactory: What You Need To Know
The company's chairman, Sonny Wu, says it intends to increase capacity to one gigawatt-hour per year, and singles out Musk and Tesla as a rival.
"Somebody has to compete with him", Wu told the WSJ.
Wu declined to name the company's potential new investors, but confirmed they are Chinese and global institutional investors.
If the funding closes, it would continue a familiar theme of Chinese investment throughout the battery and electric vehicle industry--with major players like Fisker Automotive and A123 Systems both Chinese-owned.
Wu says he expects Boston-Power to become profitable "in a couple of years".
The company won't match Musk's plans for a 35 gigawatt-hour factory--but competition in the battery market can only be a good thing for consumers.
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