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Ola signs deal with government to manufacture battery cells for EVs

Electric vehicle manufacturer Ola Electric has signed a letter of intent with the government to manufacture lithium-ion battery cells.

This was submitted to Minister for Heavy Industries Mahendra Nath Pandey on Thursday
, the company said.

The government is bullish on battery cell manufacturing domestically as it is the most critical and expensive component in an EV.

Currently, all EV makers import cells from China, South Korea and other countries.

The government has set aside Rs 18,000 crore as a production-linked incentive for the sector that manufacturers like Ola Electric can capitalise on.

New Energy , Hyundai Global Motors and are the other companies that have been shortlisted under the subsidy scheme. These companies are also expected to sign an agreement with the government.

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“Today, 90% of global capacity for cell manufacturing is in China, and to reverse this import dependency, locally manufactured cell technology is key,” said Bhavish Aggarwal, co-founder and CEO of Ola.

He said the PLI scheme will be instrumental in making India self-reliant and localizing the most critical aspects of the EV value chain.

“At Ola, our roadmap to develop cell technology and manufacturing is vigorously progressing; making us a stronger vertically integrated mobility company across – products, mobility services and tech,” Aggarwal added.

Ola Electric said on July 18 that it was investing about $500 million in a battery cell research and development facility in Bengaluru, which would start functioning in August, and would employ over 500 engineers and PhD holders.

The company also said it had developed India’s first indigenously developed lithium-ion battery cell.

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