New GM, LG plant battery plant in Tennessee heralds coming wave of EVs
Apr. 16—DETROIT — General Motors Co. and its South Korean partner, LG Energy Solution, again are investing another $2 billion in a second battery cell manufacturing plant to support the automaker's planned all-electric future.
The second plant — to be built in Tennessee by Ultium Cells LLC, the joint venture by GM and LG — is one of many that experts and ranking industry executives expect to see created as the global auto industry transitions from gas- and diesel-powered engines to battery-powered drivetrains.
This is the first year GM plans to invest more capital, more than $6 billion, on EV development than it will spend on internal-combustion engines and products. The Detroit automaker wants to sell 1 million EVs by 2025 and have a zero-emissions lineup by 2035.
"This is the future and even more battery plants will be in the offing in the next couple of years," predicted Sam Fiorani, vice president of global vehicle forecasting at AutoForecast Solutions. "There are just too many assembly plants converting to EVs for the current level of battery capacity."
GM isn't alone with its goals in a market where electric vehicles still account for less than 2% of total U.S. sales. Just this week,Stellantis NV said that by 2025 almost all of its nameplates offered in the United States will have electrified options, and all models will offer a fully battery-electric option by 2030.
Ford Motor Co. said earlier this year that it is increasing EV investment to more than $22 billion through 2025. The automaker released the electric Mustang Mach-E last year. An electric version of the Ford Transit commercial van, called the E-Transit, is slated for 2022. And an electrified version of its best-selling F-150 also is coming.
Sam Abuelsamid, principal analyst for Guidehouse Insights, explained that currently there's "roughly 40 gigawatt hours of production capacity, and to support 17 million vehicles a year ... you're looking at somewhere around 30 to 40 times the capacity that we have today."
GM's first battery cell plant with LG Energy Solution, an LG Chem company, in northeast Ohio is slated to open in the first quarter of next year. The companies also are investing more than $2 billion on that development.
Construction on the 2.8 million-square-foot Tennessee plant will start immediately, the companies said. Ultium Cells expects to open the facility in late 2023. The second plant will supply battery cells to GM's Spring Hill assembly plant where the Cadillac Lyriq, an electric crossover, will be built, along with other EVs.
The cells made at both plants use GM's proprietary Ultium battery technology. GM claims its Ultium batteries are unique to the industry because the large-format pouch style cells can be stacked vertically or horizontally inside the battery pack, allowing designers to optimize battery storage and layout for each vehicle's design.
The Ultium battery energy has range options from 50-200 kWh, which GM estimates will provide a range of up to 400 miles or more on a full charge.
GM has designated three other EV plants, including Factory Zero Detroit Hamtramck Assembly Center that will open later this year to build the new GMC Hummer EV truck. The plant also will build an SUV version of the Hummer EV, the Cruise Origin self-driving electric shuttle, and the electric version of the Chevrolet Silverado.
"We believe 2021 is truly the tipping point toward electric vehicles, and we are seeing growing enthusiasm from all corners with more customers, more commercial interests and more policymakers embracing this fundamental change in mobility," CEO Mary Barra said during an event in Tennessee confirming the second battery cell plant. "All of that is crucial for widespread adoption of EVs that is so important to our industry and to our future."
GM's move to make its own battery cells with a partner is a way to lower costs of developing the technology, experts say.
"Finding a partnership with a major battery supplier is key to keeping down costs, and potentially taking the technology over to other companies," Fiorani said.
Ford also is working with a partner to supply the battery cells in its future EVs. The Dearborn automaker was caught in the crossfire between LG and Ford's planned supplier, SK Innovation Co., for its F-150 electric pickup, among other products.
LG accused SK of stealing trade secrets. The U.S. International Trade Commission sided with LG, ruling that SK would be barred from importing batteries to the U.S. for 10 years, though it said SK could continue to supply Ford for four years and Volkswagen AG for two years to ensure the companies adequate time to find new suppliers.
But the South Korean rivals recently came to an agreement to drop all litigation related to the case and to hold off on pursuing any other disputes in the U.S. and South Korea for 10 years. SK also agreed to pay LG $1.8 billion.
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