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San Jose, Calif. — A 13,000-square-foot Silicon Valley factory, humming with robotic gear and engineers in clean room suits, offers a glimpse of how America could compete for future battery tech.

Why it matters: Reliance on batteries to power everything from electric cars to data centers will only grow, and China currently dominates the sector.

Driving the news: Next-gen battery maker QuantumScape on Wednesday officially started up its Eagle Line, a blueprint pilot factory for how customers can build their own factories to make batteries using QuantumScape's tech.

For the first time, the over 15-year-old company invited customers, partners and the media to see how its battery tech can be manufactured.

There were some theatrics, with a countdown and a giant button, and a lot of celebration as QuantumScape engineers toasted with champagne and presented the different pieces of the pilot production line. 

JB Straubel — Tesla co-founder, QuantumScape board member, and battery expert — attended and posed for a photo with the engineers. 

Catch up quick: QuantumScape has developed a solid state battery that it says can provide longer range, safer and faster charging, longer life and lower costs at scale. It's secret sauce is its solid ceramic separator.

Solid state batteries are considered the next-generation after lithium-ion batteries but they're just at the cusp of commercialization. 

China is also racing to scale its own versions. 

QuantumScape went public via a SPAC in 2020, and before that was backed by investors like Volkswagen Group, Breakthrough Energy Ventures, Khosla Ventures, Kleiner Perkins, Prelude Ventures and Lightspeed Venture Partners.

Zoom in: The company's Eagle Line, which has actually been running for about a month, is a demo for how to automate the production of its battery tech using off-the-shelf robotics and standard battery machines. 

The business model was adopted from the chip industry, where one company can be the intellectual property developer and a foundry can do the manufacturing. But it's still rare in the battery sector. 

QuantumScape hopes the pilot line will bring in customers, beyond Volkswagen's PowerCo, that want to scale and finally commercialize its tech after over a decade in development.

There were "plenty of customers" for the Eagle Line quietly walking around the launch event, QuantumScape CEO and president Siva Sivaram told Axios Pro in an interview. "We are not struggling to find customers," he said. 

Zoom out: If successful, the chip model could end up being an important way that America's battery tech competes on a global stage.

"If you do a me-too battery, China will eat you up," says Sivaram. 

Raising huge sums to build battery manufacturing within the U.S. is a daunting prospect in 2026. QuantumScape changed to the fab business model in 2024.

The U.S. EV sector has hit a lull thanks to the removal of federal tax credits and automakers pulling back from commitments. 

QuantumScape, which sells its tech to automakers, has seen its stock drop close to 30% since the beginning of the year.

A Silicon Valley battery line highlights a new model

The fab model could be a key way for American battery tech to compete.

Clear display stand on dark wooden surface holding a card with blue "QS Power" logo, and separate metallic "qset-s" text laying flat nearby.

A QuantumScape battery displayed at its Eagle Line pilot factory in San Jose, Calif. Photo courtesy of QuantumScape

San Jose, Calif. — A 13,000-square-foot Silicon Valley factory, humming with robotic gear and engineers in clean room suits, offers a glimpse of how America could compete for future battery tech.Why it matters: Reliance on batteries to power everything from electric cars to data centers will only grow, and China currently dominates the sector.

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A Silicon Valley battery line highlights a new model

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