In a surprising turn of events, Automotive Energy Supply Corp. (AESC), a Chinese-owned battery manufacturer, has halted work on a $2 billion electric vehicle (EV) battery plant in Bowling Green, Kentucky, leaving behind a massive metal shell and unfulfilled promises of 2,000 jobs. The project, which began with a groundbreaking ceremony in August 2022, reflects the broader challenges facing the U.S. EV industry as demand slows and trade policies shift. According to The Wall Street Journal, the stalled construction highlights the economic and regulatory hurdles impacting EV manufacturing.

The Rise and Pause of the Kentucky Plant

AESC launched the Bowling Green facility three years ago, celebrating it as the largest industrial investment in the city’s history. The plant, spanning a sprawling site, aimed to produce batteries for EVs, with construction kicking off amid high hopes. Last September, however, AESC quietly stopped work, leaving the structure incomplete and devoid of interior equipment.

Todd Alcott, mayor of the 72,000-person Kentucky city, expressed disappointment, stating verbatim, “A grand opening, a ribbon-cutting—we were supposed to be there at this point. We are not there.” The company’s decision to pause also affected a $1.6 billion plant in South Carolina, originally designed to supply an EV factory but now producing industrial energy storage batteries instead.

How A Chinese Battery Maker’s $2 Billion U.s. Ev Factory Bet Faltered

Technical Challenges and Cost Overruns

The halt stems from a combination of technical and economic issues. AESC began construction and ordered machinery before finalizing factory layouts, a move that drove up costs due to multiple design changes, according to current and former employees cited in the WSJ report.

For instance, the South Carolina plant underwent a reconfiguration in 2024 to accommodate more workers after demand doubled, adding millions of dollars in ventilation equipment to ensure uncontaminated battery components. These adjustments, coupled with the plant’s initial 1.2 million square feet (111,484 square meters) footprint, highlight the complexity of scaling EV battery production to meet regulatory and customer needs.

Industry Trends and Economic Pressures

The broader EV sector faces a slowdown, with companies like Ford Motor and General Motors scaling back plans. Ford’s battery joint venture in Kentucky is on ice, while GM walked away from a Michigan plant, selling its stake to LG Energy Solution. AESC’s struggles mirror this trend, exacerbated by President Trump’s trade war.

In April 2025, Trump imposed across-the-board tariffs, increasing costs for AESC as it imported manufacturing equipment for South Carolina, a move two former executives pegged as a massive financial burden. Deliveries from China and Korea also slowed, further delaying progress.

An AESC spokesman acknowledged the challenges, stating verbatim, “Changes to construction schedules at two facilities in the United States have been driven by deep policy uncertainty affecting cost and supply chains throughout the industry.”

Implications for EV Enthusiasts and Drone Pilots

For EV owners and enthusiasts, the pause signals a cautious approach to battery production. Mercedes-Benz, a key customer for the Kentucky plant, reduced its U.S. EV output plans in 2024, adjusting capacity to match demand, as a company spokesman noted. Meanwhile, the shift to energy storage batteries in South Carolina could benefit drone professionals, who rely on reliable power sources for extended flights.

AESC’s attempt to secure bank loans to complete the South Carolina plant, as mentioned by a person familiar with the matter, suggests a potential path forward, though uncertainty lingers. In Kentucky, Mayor Alcott remains optimistic, saying, “This is going to be a ‘crawl, walk, run’ approach as the world embraces automotive batteries.”

The stalled projects underscore the delicate balance between innovation, policy, and economics in the EV industry, leaving stakeholders to watch closely as AESC reworks its plans.

Photos courtesy of Kentucky Cabinet for Economic Development / Gov. Andy Beshear / X