According to the latest after-hours trading update, the stock price of Novonix Limited (NASD: NVX) has increased by 4.83% to reach $5.43. This upward trend in the stock price can be attributed to the company’s plans to ramp up its production in the near future.
What steps will NVX take to ramp up production?
Novonix (NVX) announced that it plans to scale its US synthetic graphite anode production. Earlier, KORE Power, Inc. (“KORE”) announced that $75 million out of a potential $150 million in funding had been closed. Novonix and KORE signed a strategic partnership on January 31, 2022 to advance the North American lithium-ion battery supply chain.
For the construction of KOREPlex in Phoenix, Arizona, which will start commercial production in the fourth quarter of 2024, Siemens Financial Services and other strategic investors provided an initial $75 million of strategic financing on November 30, 2022. As part of Novonix’s response to KORE’s requirement, the Company is expanding production at its Riverside facility in Chattanooga, TN to support 10,000 tons per year. Initially, this will be approximately 3,000 tons per year in 2024, and then increase to 12,000 tons per year by 2028, in order to meet KORE’s needs.
In October 2022, Novonix announced that the US Department of Energy (DOE) awarded it a grant worth $150 million for the expansion of its synthetic graphite anode materials production. As the Company continues to expand Riverside’s production output, it plans to begin building a new production facility by 2023.
It will be NVX’s first significant volume of offtake when it begins deliveries of high-performance synthetic graphite to KORE from Riverside in 2024. NVX is satisfied with the pace of its progress at the Riverside facility. This is because the company is starting to bring production online to support mass production qualification with KORE and other customers.
How NVX will be meeting the requirement?
As NVX ramps up production at Riverside, it plans to begin construction on its second plant in the first half of 2023. This will add 30,000 tonnes of production to its annual output. Battery-grade graphite is one of the few materials available in North America for the manufacturing of electric vehicles and energy storage systems, and Novonix (NVX) is confident in its ability to meet the growing demand for these materials.