Anticipating a change in the demand for electric vehicles, Northborough-based Aspen Aerogels has cancelled its efforts to construct a manufacturing facility in Statesboro, Georgia, instead pivoting to increasing its manufacturing capacity at its existing facility in East Providence and external manufacturing facilities.
The firm is evaluating its options in order to derive value from the partially constructed facility, including use of equipment at the site to upgrade its East Providence site, according to a Wednesday press release from Aspen Aerogel detailing its fourth quarter earnings. The company makes a special protective layer for EV batteries.
“In early 2023, pre-empting a reset in EV demand expectations, we decided to right-time the construction of our planned second aerogel manufacturing facility in Statesboro, Georgia and subsequently ramped up our external manufacturing capacity for our Energy Industrial business,” Ricardo Rodriguez, CFO and treasurer at Aspen Aerogels, said in the press release.
Since taking office in January, President Donald Trump has sought to cut funding of federal programs for electric vehicles, including a buildout of the national charging infrastructure.
The Aspen manufacturing site was originally expected to create more than 250 jobs and to be completed in 2023, according to a February 2022 press release from the State of Georgia announcing the firm’s plans.
Aspen Aerogels has secured $575 million in private funds for the facility through a loan from General Motors Holdings and a sale of more than $25 million shares of stock. The company had been approved for $671 million in funding from the U.S. Department of Energy for the site in October.
The company did not disclose what will happen to the various funds earmarked for the facility.
Aspen Aerogel’s fourth-quarter revenue was $124.1 million, up from $84.3 million in the fourth quarter of 2023. The firm’s net income was $11.4 million, compared to a net loss of $500,000. The company ended the year with cash and equivalents of $220.9 million.
Aspen Aerogels opened a thermal barrier research center in Marlborough in 2023.
Since the announcement of the cancellation of the Georgia plant, Aspen Aerogels stock price on the New York Stock Exchange dropped from $12.00 per share on Wednesday to $8.52 on Friday morning, a decrease of 29%.
Article Link: https://www.wbjournal.com/article/aspen-aerogels-axes-plans-for-georgia-electric-vehicle-part-manufacturing-plant
