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Released December 04, 2024 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--General Motors Company (NYSE:GM) (Detroit, Michigan) said it plans to sell its stake in the nearly completed $2.6 billion grassroot electric vehicle (EV) battery cell plant in Lansing, Michigan to project partner LG Energy Solution (Seoul, South Korea) for an undisclosed amount. Industrial Info is tracking the related project as well as others related to the companies' joint venture, named Ultium Cells LLC.
The transaction, which is expected to close in the first quarter of 2025, will not affect GM's ownership interest in the joint venture. The automaker said it expects to recoup its investment in the plant, which, according to media sources, is anticipated to be roughly $1 billion.
The 2.8 million-square-foot Lansing plant will be capable of producing 50 gigawatt-hours (GWh) worth of battery cells per year that will supply GM's EV assembly plants. Neither GM nor LG provided a specific completion date, but Industrial Info is tracking the project with completion scheduled in March. Subscribers to Industrial Info's Global Market Intelligence (GMI) Industrial Manufacturing Project and Plant databases can click here for a detailed project report and here for a plant profile.
According to the press release, LG "will have immediate access to the nearly completed Lansing facility to begin the installation of equipment."
"Our EV profitability is rapidly improving thanks in part to our strategic decision to build battery cells in the U.S. with LG Energy Solution. It will be years before some of our competitors approach this level of performance," said Paul Jacobson, chief financial officer of GM, in a press release. "We believe we have the right cell and manufacturing capabilities in place to grow with the EV market in a capital efficient manner. When completed, this transaction will also help LG Energy Solution meet demand by leveraging capacity that's nearly ready to come online and it will make GM even more efficient."
GM said it will continue to leverage the other two operational Ultium Cells plants in Warren, Ohio and Spring Hill, Tennessee, to meet growing demand for its EVs. Industrial Info is tracking a proposed $275 million expansion of the Spring Hill plant aimed at boosting the manufacturing capacity from 35 GWh to 50 GWh per year. The GMI database shows the project as having a medium probability of beginning construction in October 2025. Subscribers can click here to read the project report, here for the plant profile, and here for a profile on the Warren plant.
LG supplies the joint venture with cathode materials, which store and release lithium ions during the charging and discharging of a battery. The company is building a $3.2 billion plant in Clarksville, Tennessee designed to supply the Spring Hill plant. Planned production capacity of 120,000 tons per year is enough material to power batteries in 1.2 million EVs with a range of 310 miles per charge. Construction kicked off in December 2023, with completion expected in September 2025. Click here to read the project report.
Earlier this year, LG signed a long-term contract with GM, which will run from 2026 through 2035, to supply more than 500,000 tons of cathode materials.
Despite GM's ongoing efforts to boost EV production, and amid general project activity across the U.S. EV landscape, the domestic market could be shaken up by President-elect Donald Trump's reported desire to eliminate the $7,500 consumer tax credit for EV purchases. But it remains to be seen whether that will come to fruition.
Last month, the Zero Emission Transportation Association--whose members include automakers and material suppliers such as Tesla Incorporated (NASDAQ:TSLA) (Austin, Texas) and LG--said that effort threatens to derail proposed and current project investments. Executive Director Albert Gore said the credit is key to "actually compete to win against China."
But Reuters at the same time said Tesla representatives told a Trump-transition committee they supported ending the tax credit; doing so could drive other automakers to cut back EV production and sales, reducing Tesla's market competition.
For more information on how Trump's victory could affect federal energy policy, see November 7, 2024, article - Red Wave Washes Over D.C., with Energy Policy in Focus.
Subscribers to Industrial Info's GMI Database can click here to view reports for all of the projects discussed in this article and click here for the related plant profiles.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 trillion (USD).
The transaction, which is expected to close in the first quarter of 2025, will not affect GM's ownership interest in the joint venture. The automaker said it expects to recoup its investment in the plant, which, according to media sources, is anticipated to be roughly $1 billion.
The 2.8 million-square-foot Lansing plant will be capable of producing 50 gigawatt-hours (GWh) worth of battery cells per year that will supply GM's EV assembly plants. Neither GM nor LG provided a specific completion date, but Industrial Info is tracking the project with completion scheduled in March. Subscribers to Industrial Info's Global Market Intelligence (GMI) Industrial Manufacturing Project and Plant databases can click here for a detailed project report and here for a plant profile.
According to the press release, LG "will have immediate access to the nearly completed Lansing facility to begin the installation of equipment."
"Our EV profitability is rapidly improving thanks in part to our strategic decision to build battery cells in the U.S. with LG Energy Solution. It will be years before some of our competitors approach this level of performance," said Paul Jacobson, chief financial officer of GM, in a press release. "We believe we have the right cell and manufacturing capabilities in place to grow with the EV market in a capital efficient manner. When completed, this transaction will also help LG Energy Solution meet demand by leveraging capacity that's nearly ready to come online and it will make GM even more efficient."
GM said it will continue to leverage the other two operational Ultium Cells plants in Warren, Ohio and Spring Hill, Tennessee, to meet growing demand for its EVs. Industrial Info is tracking a proposed $275 million expansion of the Spring Hill plant aimed at boosting the manufacturing capacity from 35 GWh to 50 GWh per year. The GMI database shows the project as having a medium probability of beginning construction in October 2025. Subscribers can click here to read the project report, here for the plant profile, and here for a profile on the Warren plant.
LG supplies the joint venture with cathode materials, which store and release lithium ions during the charging and discharging of a battery. The company is building a $3.2 billion plant in Clarksville, Tennessee designed to supply the Spring Hill plant. Planned production capacity of 120,000 tons per year is enough material to power batteries in 1.2 million EVs with a range of 310 miles per charge. Construction kicked off in December 2023, with completion expected in September 2025. Click here to read the project report.
Earlier this year, LG signed a long-term contract with GM, which will run from 2026 through 2035, to supply more than 500,000 tons of cathode materials.
Despite GM's ongoing efforts to boost EV production, and amid general project activity across the U.S. EV landscape, the domestic market could be shaken up by President-elect Donald Trump's reported desire to eliminate the $7,500 consumer tax credit for EV purchases. But it remains to be seen whether that will come to fruition.
Last month, the Zero Emission Transportation Association--whose members include automakers and material suppliers such as Tesla Incorporated (NASDAQ:TSLA) (Austin, Texas) and LG--said that effort threatens to derail proposed and current project investments. Executive Director Albert Gore said the credit is key to "actually compete to win against China."
But Reuters at the same time said Tesla representatives told a Trump-transition committee they supported ending the tax credit; doing so could drive other automakers to cut back EV production and sales, reducing Tesla's market competition.
For more information on how Trump's victory could affect federal energy policy, see November 7, 2024, article - Red Wave Washes Over D.C., with Energy Policy in Focus.
Subscribers to Industrial Info's GMI Database can click here to view reports for all of the projects discussed in this article and click here for the related plant profiles.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 trillion (USD).
