Electric cars drive prompts LG investment in US battery business

The Korean company, which has a joint venture with General Motors (GM), said the investment will help create 10,000 jobs, including subcontractors.

GM and LG are currently building a $2.3bn (£1.6bn) battery factory in Lordstown, Ohio, near Cleveland, that will employ about 1,000 people when completed in 2022.

The site is close to GM’s two other designated electric vehicle plants, one in Detroit and the other north of the city in Orion Township, Michigan. The companies hope to get a decision on a second site in the first half of the year.

LG’s investment comes as US President Joe Biden’s administration laid out its plans to tackle climate change, which are likely to include taking on the oil and gas industry.

“The goals of the US president and automakers will be a propelling factor in the growth of the country’s electric vehicle and energy storage systems markets,” said Jong Hyun Kim, CEO of LG Energy Solution.

“LG Energy Solution is dedicated to expanding its battery production capacity and structuring a stable, localised supply chain that provides everything from R&D to production.”

General Motors has changed its corporate logo and launched an electric vehicle marketing campaign to reshape its image as a clean vehicle company, rather than a builder of petrol-powered pick-ups and SUVs.

The Detroit carmaker has promised to roll out 30 new battery-powered vehicles globally by the end of 2025 and said the new campaign will highlight its progressive vision for the future.

GM is likely to need far more battery capacity if it can deliver on a goal of converting all of its new passenger vehicles from internal combustion engines to electricity by 2035.

Consulting firm LMC Automotive predicts that US battery-powered vehicle sales will hit over one million per year starting in 2023, reaching over four million by 2030.

Meanwhile, industry analysts have said that carmakers face a global shortage of batteries as the industry moves away from petrol and diesel-powered vehicles. China and Japan build most of the world’s batteries.

LG recently announced that it will make cells in Tesla’s new 4680 battery format. The firm also makes batteries for Chevy’s electric Bolt vehicle.

Last December, Chile’s SQM, the world’s second-largest lithium producer, said it had signed a long-term agreement with LG Energy Solution to supply the ultralight battery metal for electric vehicles.