LG Energy Increases Battery Production in the US with $1.4B Investment

LG Energy Increases Battery Production in the US with $1.4B Investment

LG Energy Solution, which provides Tesla, Lucid Motors, General Motors, and Proterra with electric car batteries, said on Thursday that it will invest $1.4 billion (1.7 trillion KRW) in a cylindrical battery factory in Queen Creek, Arizona. LG Energy is clearly expanding its influence in the United States, as seen by this action. In January, the business announced intentions to invest $2.1 billion in a third joint EV battery production in the United States with General Motors. Stellantis also signed an agreement with LG last year to manufacture battery cells and modules in North America.

LG’s investment in Arizona comes at a time when the North American market is seeing an increase in demand for cylindrical cells and applications that employ cylindrical batteries, such as electric tools that require quick power or mobility devices like EVs or e-bikes. According to an LG representative, this is because these batteries are smaller yet have a high energy density. According to the firm, work on the 11-gigawatt-hour capacity plant would begin in the second quarter of 2022, with mass production beginning in 2024.

The facility, according to LG Energy, will be the first cylindrical-type battery production plant in North America, supplying EV manufacturers. EV manufacturers such as Tesla, Lucid, and Proterra, according to Reuters, might be possible clients. LG said it is working on contracts, but wouldn’t say which firms it will serve through its Arizona manufacturing. LG Energy has stated that it is exploring expanding its production capacity in the United States. LG Energy collected more than $10 billion in its initial public offering in January.

Panasonic, which also provides Tesla with battery goods, is looking for a location to develop a manufacturing in Oklahoma or Kansas, according to NHK. Toyota is also proposing to develop a battery facility in the United States, with manufacturing set to begin in 2025. The surge of international battery businesses creating batteries in the United States might be a result of President Joe Biden’s infrastructure program, which includes billions of dollars for the development of a national battery supply chain. LG did not respond in time when asked if it is qualified for US subsidies to establish such supply networks.