Ultium Cells, a electric vehicle battery joint venture established by LG Energy Solution and General Motors (GM), is considering investing US$2.5 billion to build a new battery plant near a GM auto assembly plant in Lansing, Michigan. If the plan is finalized, it will be the third joint venture plant after those in Ohio and Tennessee.
Authorities in Lansing, Michigan, a leading candidate site for the third plant of Ultium Cells, recently approved an economic development program that will exempt taxes and utility bills over the next 20 years if Ultium Cells builds a battery plant in the city, according to local media outlets on Dec. 23. The Board of Water and Light (BWL) of Lansing estimated the total amount of tax benefits at US$936 million.
Earlier in November, LG Energy Solution decided to invest US$681 million in LG Energy Solution Michigan, its Michigan subsidiary. The amount is half of the 1,576.2 billion won that Ultium Cells will invest to build the third plant. LG Energy Solution plans to raise the other half through borrowings.
When the Michigan plant is built, LG Energy Solution’s U.S. battery production capacity will climb to 150 GWh. The company is operating its own 5 GWh battery plant in Michigan. It is also building two 35 GWh battery production plants in Ohio and Tennessee together with GM. Recently, it has also confirmed the establishment of a 40 GWh joint venture (JV) plant with Stellantis, one of the top three U.S. automakers. LG Energy Solution announced that it will invest five trillion won in the United States by 2025 to produce batteries of 70 GWh independently.
LG Energy Solution plans to ramp up the production capacity of its overseas factories to 430 GWh by 2025, with its U.S. plants accounting for more than 30 percent of the total.