LG Energy Solution investing 730 billion won in EV battery production

Tech

Published: 13 Jun. 2022, 19:01 Updated: 13 Jun. 2022, 19:22

LG Energy Solution investing 730 billion won in EV battery production

LG Energy Solution Ochang Plant in North Chungcheong [LG ENERGY SOLUTION]

LG Energy Solution will invest 730 billion won ($568 million) to expand EV battery production capacity at its Ochang plant in North Chungcheong, the company said Monday.

This will include building new facilities as well as an expansion of existing facilities.

Of the amount, 580 billion won will go to building a cylindrical battery facility for the making of "4680 cells" with an annual capacity of 9 gigawatt-hours inside Ochang Plant 2. The remaining 150 billion won will go to expanding capacity for the production of "2170 cells" inside Plant 1 by 4 gigawatt-hours.

This is the first time that the company has announced the production of 4680 battery cells. The 4680 indicates the size of the batteries, which will be 46 millimeters (1.8 inches) in diameter and 80 millimeters in length. The 2170 cells are 21 millimeters in diameter and 70 millimeters long.

According to local media reports, the 4680 cells will be supplied to Tesla, which announced that the batteries will be used for its new Model Y cars and possibly other future electric vehicles.

The construction will start in the second half, with the goal to start manufacturing by the latter half of next year.

“The decision comes as we aim to meet the increasing demand for cylindrical batteries from global carmakers,” said Kwon Young-soo, Vice Chairman and CEO of LG Energy Solution, in a statement.

“We will endeavor to keep catering to our clients by expanding our product portfolio to include both pouch-type and cylindrical batteries.”

LG Energy Solution has recently been seeking to expand its cylindrical battery production capacity, in addition to its previous staple pouch-type batteries.

In March, the company announced a 1.7-trillion-won investment in a new factory for cylindrical lithium-ion batteries in Arizona, U.S. The company also announced that month that it is building a factory in a joint venture with Stellantis in Canada.

LG Energy Solution and Stellantis will together invest 4.8 trillion won to build a pouch-type lithium-ion battery factory in Ontario.

BY YOON SO-YEON [yoon.soyeon@joongang.co.kr]