GM will sell its battery cell plant to LG Energy Solution

First, the plant in Michigan: In the summer, it was reported that GM halted construction of the Lansing plant due to the slowdown in global demand for electric cars. The decision to sell its share of the factory to partner LGES does apparently “not change GM’s ownership interest in Ultium Cells LLC,” the carmaker emphasises. The latter is a joint venture between General Motors and LGES.

Ultium Cells already operates (and will continue to operate) two cell factories, one in Ohio and the second in Spring Hill, Tennessee. The plant in Warren has been producing since 2022, while the first cells from Spring Hill were only delivered this April – to the GM plant around half a mile away. The joint venture dropped plans for a fourth US battery factory in early 2023.

The transaction should be completed in the first quarter of 2025, giving LGES “immediate access to the nearly completed Lansing facility to begin the installation of equipment.” GM also says there will be no job cuts at that facility.

“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,” says Paul Jacobson, GM executive vice president and CFO. “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.” 

Ultium Cells currently produces pouch-type cells. While Jacobson believes that GM has “the right cell,” the carmaker is looking at diversifying form factors. It has extended its technology partnership with LG Energy Solution to include prismatic cells, adding that it “expects the prismatic cell technology developed under the agreement to power future GM electric vehicles.”

Prismatic cells are flatter and allow for more space-efficient packaging in battery modules, in turn reducing an EVs weight and increasing its range. LG Energy Solution already has experience with the format, while GM wants “to diversify its supply chain, leveraging multiple chemistries and form factors.”

“We’re focused on optimising our battery technology by developing the right battery chemistries and form factors to improve EV performance, enhance safety, and reduce costs,” explains Kurt Kelty, GM vice president of battery cell and pack. “By extending our partnership with LG Energy Solution, we’re taking an important step toward these goals.” 

“LG Energy Solution is proud to be expanding its relationship with one of its strongest partners. Together with GM, we’ve already made tremendous progress,” adds Wonjoon Suh, executive vice president and head of the company’s Advanced Automotive Battery division. “We look forward to deepening our collaboration to drive the right chemistry and battery combinations for continued growth in the EV market.”

gm.com (Michigan), gm.com, lgcorp.com (prismatic cells)