LG North America invests $1.5 billion to build a new power battery company

In the fierce global power battery production capacity chase, South Korean battery giant LG Energy Solution is still making efforts in North America: on the one hand, the joint venture power battery enterprise established by the company and auto giant Stellantis in Canada will officially land; On the one hand, it is preparing to invest heavily in the expansion of its power battery plant in Michigan, USA.

LG New Energy officially announced on Wednesday that it plans to invest $1.5 billion to establish a power battery joint venture with Stellantis in Canada.

LG New Energy said in regulatory filings that LG New Energy will own 51 percent of the joint venture, while Stellantis owns 49 percent, tentatively named the “LGES-Stla Joint Venture.”

LG New Energy also added that its board of directors has approved a debt guarantee for its joint venture with Stellantis, which has $627 million in debt.

As early as last October, LG New Energy and Stellantis announced their intention to set up a power battery production joint venture. It was revealed in the announcement at the time that the joint venture aimed to start production in the first quarter of 2024 and increase the annual battery production capacity to 40 GWh.

U.S. may expand production

In addition, LG New Energy already has a wholly-owned power battery factory in Michigan, and has two battery joint ventures with General Motors in Ohio and Tennessee.

According to the latest business proposal submitted by LG New Energy, LG New Energy will also invest $1.7 billion to expand its Michigan plant, increasing its annual production capacity by five times. The specific production capacity of the plant has not been disclosed, but according to foreign media reports, the current annual production capacity is 5 GWh.

LG New Energy is also considering building a factory in Arizona that is expected to mainly produce cylindrical batteries, two people familiar with the matter said.

A spokesman for LG New Energy said: “We are considering a new production location, but no decision has been made.”

Tesla, General Motors and Volkswagen are all customers of LG New Energy, which currently has battery production plants in the US, China, Poland, Indonesia and South Korea.

According to media calculations, after the joint venture between LG New Energy and Stellantis is completed and started, plus the production capacity of the two joint ventures of LG New Energy and GM, as well as the production capacity of LG New Energy’s own wholly-owned company in the United States, LG New Energy will be in the Annual battery capacity in North America is expected to reach nearly 200 GWh.

Mylion battery factory website: https://myliontech.com/