EnerSys, a global leader in stored energy solutions for industrial, infrastructure, and defence applications, today provided an update on its planned U.S. lithium cell manufacturing facility in Greenville, South Carolina, reflecting a refined strategy under which the plant will be focused on the development and manufacturing of lithium cells for aerospace and defence and specialised industrial applications where a secure U.S.-based supply chain is essential. The updated plan is centred on serving customers where U.S.-based production is a critical requirement and demand is expected to be incremental to the Company's current business. The facility is intended to support defence requirements for secure, foreign entity of concern (FEOC) compliant lithium-ion cells and strengthen U.S. supply chain resilience.

EnerSys has been awarded a revised grant from the U.S. Department of Energy (DOE) of approximately $150 million, subject to final documentation and customary conditions. The Company currently estimates the total net investment for the facility to be approximately $500 million. As shared previously, EnerSys has also been awarded a comprehensive incentive package through South Carolina and Greenville County valued at approximately $200 million, which includes a combination of short-term and long-term incentives. Under the updated plan, EnerSys expects the facility to have an initial production capacity of approximately 1 gigawatt hour, purpose built to meet the specialised requirements of defence applications. EnerSys intends to use federal, state, and local funding, and operating cash flow to support the capital requirements of the factory. EnerSys' Board of Directors has formally approved the investment and development plan.

"This refined manufacturing strategy builds on EnerSys' long-standing role as a trusted supplier of stored energy solutions supporting U.S. defence applications," said Shawn O'Connell, President and Chief Executive Officer of EnerSys. "By dedicating this facility to defence-focused lithium cell development and manufacturing, we will further strengthen a secure, resilient, domestically sourced supply chain aligned with evolving U.S. national security requirements. Importantly, this approach allows us to support customers where domestic production is essential, while generating incremental revenue opportunities beyond our internal supply needs. Consistent with our EnerGize strategic framework, this is a disciplined investment that will allow us to support our customers' needs, aligned with our commitment to deliver long-term value for shareholders."

EnerSys first announced plans in 2023 to develop a U.S.-based lithium cell manufacturing facility as part of its long-term strategy to expand domestic manufacturing capabilities. Since that time, the Company has worked closely with the DOE to evaluate the optimal scope and strategic focus for the project. The revised approach reflects the specialised requirements associated with defence applications and EnerSys' commitment to supporting defence-critical supply chains. Given the facility's refined defence-focused scope, EnerSys intends to transition away from its technology relationship with Verkor and does not expect Verkor to serve as the project's technology partner going forward. EnerSys expects to support the project by leveraging a decades-long, established technology partnership within its existing aerospace and defence supply base.

The Company currently anticipates beginning construction in the first half of fiscal year 2028, subject to customary approvals and conditions, with full production expected approximately three years after construction begins.