A German company building its first South Carolina plant has received a $111.9 million tax credit for its half-billion-dollar plan to create a link in the electric vehicle supply chain in Sumter County.
The Qualifying Advanced Energy Project Tax Credit is part of the U.S. Department of Energy’s 48C plan to build clean energy supply chains.
The company, e-VAC Magnetics, produces rare earth neodymium-iron-boron (NdFeB) magnets, which are critical to automotive, defense, industrial and renewable energy applications. The company broke ground on the state-of-the-art facility in March, and expects to complete the facility in late fall 2025, according to a news release. The project is expected to create 300 new jobs in Sumter.
In December, the company announced plans to build a $500-plus million plant in Sumter County on 85 acres in the Pocotaligo Industrial Park. It is the largest economic development deal in county history.
Related story: Manufacturer new to U.S. building Sumter facility
E-VAC is part of the German company Vacuumschmelze, which traces its roots to 1913 Hanau, Germany, when founder Wilhelm Rohn developed a process for melting metals in a vacuum, according to the company website. The company manufactures products for automotive, smart industry, aerospace, energy generation and medical uses.
“E-VAC is proud to invest in America’s 21st century supply chain and to advance clean energy manufacturing efforts,” VAC Group CEO Erik Eschen said in a news release. “This award demonstrates the importance of high-quality, high-performance magnetic materials, which are key enablers to electrification and energy efficiency across a range of industries. Our facility will help to establish a resilient, U.S.-based supply chain for decades to come.”
In January 2023, e-VAC announced a binding long-term supply agreement with GM to manufacture permanent magnets, using locally sourced raw materials, for the electric motors used in a broad portfolio of EVs in North America, the release stated. In September 2023, the Defense Department entered into an agreement with e-VAC as part of its “Mine-to-Magnet” supply chain initiative, ensuring U.S. companies are able to source and produce the rare earth permanent magnets that are essential components in the F-35 fighter jet, Unmanned Aerial Vehicles, and numerous other defense systems.
The company also has secured $94.1 million from the Department of Defense for the role it will play in supplying those defense systems.
Atlanta-based Evans General Contractors, with offices in Greenville and North Charleston, said it will build the plant.
In October 2023, VAC was acquired by Ara Partners, a private equity and infrastructure firm that specializes in industrial decarbonization investments. Ara’s investment has provided VAC with the capital to expand and build a rare earths value chain.
“The Inflation Reduction Act is helping companies invest in America and build critical domestic supply chains,” Tuan Tran, partner at Ara Partners, said in the release. “Suppliers like e-VAC will play an important role in decarbonizing the industrial world, and we are committed to helping these companies expand their footprints here in the U.S. while substantially reducing emissions.”
Ara Partners is a global private equity and infrastructure investment firm focused on industrial decarbonization. Founded in 2017, Ara Partners seeks to build and scale companies with significant decarbonization impact across the industrial and manufacturing, chemicals and materials, energy efficiency and green fuels, and food and agriculture sectors.
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