Gotion High Tech Morocco to start production in 2026

China's Gotion High Tech (002074.SZ) will start production at a gigafactory it plans to build in Morocco in the third quarter of 2026, Hicham Chaoudri, head of the investment department, said Friday.

Gotion High Tech signed an investment agreement with the Moroccan government on Thursday to establish a $1.3 billion battery production plant in Kenitra, north of Rabat. "This is a historic investment that marks the first gigafactory in Africa," Chaoudri said, noting that construction will begin in a few weeks.

In addition to batteries, the plant will also produce key ingredients such as cathodes and anodes, with most of the production destined for export, Chaoudri said.

Gotion High Tech plans to increase the plant's capacity to 100 gigawatt hours (GWh) from an initial capacity of 20 GWh, with an eventual investment that could amount to $6.5 billion, the Moroccan government said in a statement.

The investment would have a beneficial impact on the country's drive to attract more manufacturers along the EV battery supply chain as it seeks to adapt its automotive sector to the requirements of the EV industry, he said.

"Through such investments, we seek to preserve 220,000 jobs in the automotive sector as it shifts from combustion engines to electric motors," he said.

The automotive sector led Morocco's industrial exports with $14 billion in 2023, an increase of 27% over the previous year.

"We are negotiating with other manufacturers...other investments are coming in," Chaoudri said.

Morocco is home to production plants of automakers Stellantis (STLAM.MI) and Renault (RENA.PA) with a combined annual production capacity of 700,000 cars, as well as a cluster of local suppliers.

The country's geographical location close to Europe, its free trade agreements with major EU and U.S. markets and its existing automotive industry make it attractive to Chinese electric vehicle battery manufacturers.

In May, Chinese automotive battery manufacturers Hailiang and Shinzoom announced plans to establish two separate plants near Tangier, which will produce key ingredients for electric vehicle batteries: copper and anodes, respectively.

A month earlier, the Moroccan government gave the green light to Chinese electric battery manufacturer BTR New Material Group (835185.BJE) to build a factory near Tangier to produce key components such as cathodes.

Another Chinese manufacturer, CNGR Advanced Material (300919.SZ), plans a cathode plant in Jorf Lasfar, 100 km south of Casablanca, where the government has allocated 283 hectares to electric battery industries.

Collaboration: Grupo Auge | Reuters (International).