Amazon’s AWS to invest $35 billion in Virginia

WASHINGTON, Jan 20 (Reuters) – Amazon.com Inc’s ( AMZN.O ) cloud services division said on Friday it plans to invest another $35 billion by 2040 to expand data centers in Virginia.

Amazon Web Services (AWS) said the new investment will create 1[ads1],000 jobs. Virginia’s Republican Governor Glenn Youngkin said AWS will establish more data center campuses across Virginia.

In 2021, AWS said that from 2011 to 2020, it had invested $35 billion in data centers in Northern Virginia and had 3,500 full-time employees at its data centers in the state.

Pending approval by state lawmakers, Virginia is developing a new “Mega Data Center Incentive Program,” which will allow the company to receive up to a 15-year extension of data center sales and use tax exemptions on equipment and software.

AWS will also be eligible to receive a government grant of up to $140 million “for site and infrastructure improvements, workforce development and other project-related costs.”

Amazon shares closed up 3.8 percent on Friday.

Amazon in 2018 after a long competition announced that Northern Virginia would be home to the second headquarters known as “HQ2” and eventually employ more than 25,000 employees. As of April, Amazon said the number of employees assigned to the site was about 5,000.

Youngkin has faced some criticism for pulling out of a competition to attract a new Ford Motor ( FN ) battery plant expected to be built with China’s Contemporary Amperex Technology Co Ltd ( CATL ) ( 300750.SZ ), the world’s biggest battery maker.

Youngkin defended his decision Friday, telling Bloomberg News that he looks forward to bringing a great company there. It will not be one that uses some sort of Trojan horse relationship with the Chinese Communist Party to win.

A spokesperson for Youngkin has said that “while Ford is an iconic American company, it became clear that this proposal would serve as a front for the Chinese Communist Party.”

Ford declined to comment on Youngkin’s decision to retire.

In July, Ford said it plans to locate 40 GWh of battery capacity in North America starting in 2026. It also announced that CATL will supply battery packs for Mustang Mach-E models for North America starting in 2023 and will discuss battery partnerships in Ford vehicles around the world.

“Our talks with CATL are continuing – and we have nothing new to announce on either front,” Ford said.

Michigan is also a candidate for the Ford battery plant, sources said, and a decision could be made in the coming weeks.

Reporting by David Shepardson and Akash Sriram in Bengaluru; Editing by Aurora Ellis and Himani Sarkar

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