$1.6 billion battery plant in South Carolina hits pause

A major Japanese battery maker has stopped construction on a $1.6 billion plant in South Carolina, citing “policy and market uncertainty” tied to electric vehicles and global trade.

Automotive Energy Supply Corp. (AESC) said Thursday it’s temporarily halting work on the factory in Florence, which is meant to supply batteries for electric BMWs made in the state.

The company didn’t list specific concerns, but South Carolina Governor Henry McMaster pointed to worries over changes to federal EV tax credits, incentives for clean energy businesses, and potential new tariffs under President Donald Trump.

“We’re urging caution,” McMaster said. “Let things play out — all these changes are happening at once.”

AESC has pledged to restart construction, though it hasn’t given a timeline. It says it will still meet its promise to hire 1,600 workers and invest $1.6 billion, and has already spent $1 billion on the site.

The Florence plant is meant to supply battery cells to BMW, which is building its own assembly plant nearby. BMW says the AESC delay won’t affect its timeline to open in 2026.

South Carolina had previously pulled back $111 million in planned incentives after AESC scaled down its original plans. But the company is still set to receive $135 million in grants and $121 million in state bonds.

The pause comes as other clean energy projects in the U.S. are also facing uncertainty tied to Trump’s trade stance. An earlier analysis found $14 billion worth of clean energy projects have been canceled nationwide.

Still, South Carolina continues to bet big on EVs. Scout Motors, owned by Volkswagen, plans to open a $2 billion plant in the state in 2027 to build electric SUVs.

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