LG Energy Solutions selects two new factories in the US in the first half of the year and will invest 5 trillion won on its own in the local battery market.
The goal is to secure an additional battery production capacity of more than 70 gigawatt hours (GWh) in the US alone. In the first half of the year, a joint venture with GM will decide to invest in the second plant after the first plant currently under construction.
On the 12th, LG Energy Solutions announced this investment plan, saying, “We will invest in batteries to lead the eco-friendly industry in the US market in line with the acceleration of electric vehicle conversion and market environment changes due to the Green New Deal.
5 trillion won in US batteries by 2025… Build 2 new factories + α
LG Energy Solutions decided to invest more than 5 trillion won in the US alone by 2025. When investment is made, the independent battery production capacity (CAPA) will increase to a total of 75GWh by adding the Michigan plant (5GWh).
To this end, it plans to select at least two candidate sites in the US by the first half of the year. The company plans to make full-fledged investments through promptly the business suitability review and the board resolution process.
If additional production capacity of 70GWh is secured, it is expected that more than 10,000 new jobs can be created, including 4,000 direct employees and 6,000 employees during the construction period. The number of direct employees in the United States is 6,500, with 1,400 Michigan factories and 1,100 joint ventures with GM located in Ohio combined.
The new factory will be built as a’green factory’ operated only with 100% renewable energy. Already, the Michigan plant has been operating only on renewable energy since the second half of last year.
In addition to pouch batteries for electric vehicles and energy storage devices (ESS), it is also advancing into the rapidly growing cylindrical battery field for electric vehicles. LG Energy Solutions has been promoting the’Green Field’ project from the second half of last year in order to contribute to the Green New Deal and eco-friendly policies of the United States.
This investment decision is interpreted as an intention to solidify cooperation with automakers and ESS companies by lowering concerns about the supply of batteries in the US market. LG Energy Solutions said in a conference call on the final decision of the ITC litigation on the 5th, “In order to respond to market growth, we are pursuing by converting the strategy of’investment after receiving pre-orders’ into preemptive investment in capacity expansion.” It has been revealed.
Construction of GM plant 2 is also promoted… Investment continues until 2030
The company is also considering additional investment in a joint venture with GM of the United States. LG Energy Solutions-GM joint venture’Ultium Cells’ is currently building a 35GWh plant in Ohio with the goal of operating next year. The joint venture plans to determine the specific investment scale and site for the second plant within the first half of the year.
The second plant of the joint venture is expected to be on the same scale as the first plant in Ohio. The goal is to supply stable batteries for GM’s future electric vehicle projects. LG Energy Solutions explained that the mass-produced product is a battery to which the next-generation advanced technology is applied.
When the second plant is built, it is expected to secure a total production capacity of 140GWh or more by combining its own production capacity and the production capacity of the joint venture. The company plans to continue investing by 2030 according to the market growth rate. To this end, various types of supply chains such as joint ventures and joint investments with customers are also promoted.
We will also actively promote localization and advancement with business partners. Based on the experience of establishing an electric vehicle battery research corporation in the U.S. since 2000 and continuing investment, it will focus on establishing a stable supply chain from R&D to product development and production, and procurement of raw materials.
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Orders from US ESS companies and start-up electric vehicle companies are also increasing significantly. An official of the company explained, “The global automaker industry is considering local production to respond to the US electric vehicle market. We are discussing business expansion in the US with several automakers, so we need to secure battery production capacity one step faster. did.
Jong-Hyun Kim, President of LG Energy Solutions, said, “The US Green New Deal policy will further accelerate the growth of the ESS market as well as the electric vehicle market.” As the best partner in the US electric vehicle and ESS market, we will contribute to the success of the US Green New Deal.”