(Yicai Global) June 5 -- Chinese corporate investment is helping northern France to become Europe's 'Battery Valley,' the electric vehicle industry's answer to Silicon Valley.

There are four major battery projects ongoing in Haute-de-France, France's northernmost region. Of them, one is operated by Taiwan-based solid-state battery maker ProLogium and one by Envision AESC, the electric car battery unit of Chinese green energy firm Envision Group.

“This territory perfectly embodies our policy, with both a transformation of the actors in place and a strong attractiveness,” Le Monde reported the French president’s office as saying last month when confirming ProLogium’s arrival. Emmanuel Macron also unveiled a raft of green measures and tax credits to attract investment in Battery Valley, The Guardian reported on May 30.

ProLogium announced plans on May 12 to spend EUR5.2 billion (USD5.6 billion) to build a gigafactory and a research and development center in Dunkirk with an annual production capacity of 48 gigawatt-hours.

In 2021, Envision AESC said it would invest EUR800 million (USD856.2 million) in the first phase of its battery plant in Douai, Haute-de-France, which is expected to start up next year. The factory has a target production capacity of 24 GWh by 2030.

The other two gigafactory projects in the Haute-de-France region are operated by Automotive Cell Company, a tie-up between carmakers Stellantis and Mercedes-Benz and energy giant TotalEnergies, and a JV between French auto giant Renault and local low-carbon battery maker Venkor.

Besides these big ticker projects, other Chinese companies also have announced investments in northern France.

Xiamen Tungsten New Energy Materials recently teamed up with French nuclear fuel cycle supplier Orano to invest EUR1.5 billion (USD2.1 billion) in setting up a battery JV in Dunkirk that is expected to create 1,700 jobs.

France was the preferred European investment destination for Chinese firms last year, with China being France's biggest Asian investor. Chinese businesses invested in 45 projects in France in 2022, creating 995 jobs. Investors from China control over 900 French companies and employ more than 50,000 people, Business France reported last month.

Although Chinese investment in Europe hit a decade low of EUR7.9 billion last year, invetsment by Chinese firms in green sectors, driven by EV battery plants, soared 53 percent, surpassing merger and acquisition deals for the first time since 2008, according to research group Rhodium. Chinese spending in Europe will likely pick up somewhat this year.

Chinese investment in green sectors in France, especially EVs, will increase in the future, Wei Qinglian, chairwoman of Chinese auto parts supplier Minth Group, told reporters on May 30.

In June last year, Minth announced it would set up a JV with Renault to produce EV battery boxes. With an investment of EUR49 million (USD6.9 billion) for the first phase, the project will be located in Haute-de-France and create 270 jobs, the firm noted.

Chinese companies are considering expanding investment in the upstream and downstream of the European EV industry, including auto production, according to Rhodium.

Editors: Shi Yi, Futura Costaglione