GM CEO and Chairman Mary Barra speaks during an “EV Day” on March 4, 2020 on the technology and design campus of the company in Warren, Michigan, a suburb of Detroit.
GM
General Motors and South Korean LG Chem will invest more than $ 2.3 billion in a second U.S. electric vehicle battery plant in Tennessee, the companies announced Friday.
The plant for their Ultium Cells LLC joint venture will support the production of GM’s upcoming Cadillac Lyriq crossover and other future EVs in a nearby assembly plant.
The supply and production of battery cells is crucial for automakers that run on electric vehicles. The joint venture for the new plant, while still under construction in Lordstown, Ohio, emphasizes this.
Construction of the approximately 2.8 million square meter plant will begin immediately. The plant is scheduled to open in late 2023 and will create 1,300 jobs, the companies said.
“The addition of our second brand new Ultium battery cell plant in the US with our partner LG Energy Solution is another important step in our transition to a fully electric future,” said Mary Barra, CEO of GM.
The announcement comes amid a 100-day review ordered by President Joe Biden of the U.S. supply chain for advanced batteries, pharmaceuticals, critical minerals and semiconductors. He ordered the review amid a continuing global shortage of semiconductor chips that significantly impacted U.S. car production in 2021.
GM confirmed last month that it was evaluating a second place in the US to manufacture battery cells for electric vehicles with LG. Reuters reported details on Wednesday of the announcement.
Young Hyun Kim, President and CEO of LG Energy Solution, said the new facility will enable companies to build a solid and stable supply chain in the US that includes everything from research, product development and production to sourcing. components possible. ‘
Some analysts, specifically Adam Jonas, of Morgan Stanley, have warned of a possible shortage due to cell capacity compared to the amount of new EVs that are expected to hit the market in the coming year.
“In our view, GM’s establishment of Ultium / Ultium Cells LLC will be a critical point of strategic differentiation that will ultimately drive shareholder value creation,” he said in a note to investors on Wednesday.
Ultium is the next generation of batteries and platform from GM, which is expected to launch in the GMC Hummer EV pickup this year. The first vehicles are not expected to contain Ultium battery cells from the Ohio plant under construction.
An undated handout photo shows the new Cadillac Lyriq, one of the electric vehicles that General Motors Co announced on October 20, 2020 that it will begin production at its plant in Spring Hill, Tennessee.
General Motors Co | Reuters
GM is expected to continue to build plants or convert to battery facilities in the US, as it becomes a carmaker offering by 2035 exclusively electric vehicles. This includes at least 30 new EVs by 2025 under a $ 27 billion investment facility in electric and autonomous vehicles during that time frame.
Most batteries, such as semiconductors, are manufactured in Asia and Europe. Tesla operates a large battery and cell manufacturing facility with Panasonic in Nevada. Tesla also told investors in September that it had begun manufacturing its own cells at a pilot plant in Fremont, California.
GM and LG only announced the joint venture in December 2019.