LG Chem to invest $11 billion in EV battery, material business in U.S.
The investment was announced Tuesday by LG Chem CEO Shin Hak-cheol during his meeting with U.S. Treasury Secretary Janet Yellen at LG Sciencepark in Magok-dong, western Seoul. Yellen toured the battery material facility and held a 30-minute meeting with Shin.
"LG Chem will invest $4.5 billion through 2025 solely in battery materials to build a diverse product portfolio of cathode materials, separators and carbon nanotubes, just to name a few," Shin said. "We are also actively considering establishing a cathode manufacturing plant in North America to strengthen the battery supply chain, which will collectively make our battery-related investment in the United States exceed $11 billion."
The investment also includes LG Energy Solution's construction of five EV battery plants in the United States. LG Chem owns 81.8 percent of LG Energy Solution, an EV battery maker.
Three facilities are being built by Ultium Cells, a 50-50 joint venture between LG Energy Solution and General Motors, in Ohio, Tennessee and Michigan. The Ohio plant will start mass production in the second half of the year.
Ultium is likely to announce its investment plan for the fourth plant soon as General Motors CEO Mary Barra hinted that she will make the announcement in the second half during a recent press conference call.
LG Energy Solution also established a joint venture with Stellantis to build a plant in Ontario, Canada. Ground will be broken in the second half.
The Korean battery maker also has a plan to build an independent factory in Arizona. The company bought a 650-acre site in Queen Creek in April, though it is currently reassessing the $1.3-billion investment it initially planned. It blamed "unfavorable business conditions," including "surging costs driven by inflation."
“Even if the United States makes investments to expand domestic production capacity for critical products, as I mentioned, we must work with allies and partners to secure supplies of critical goods that we will not make insufficient quantities at home,” Yellen said. “To make our supply chains more resilient, we need to maintain strong economic ties with critical allies like Korea while lessening the risks associated with the over-concentration of key supplies in unreliable countries."
Shin also emphasized his plan of focusing on battery recycling technologies. In December, LG Chem invested $50 million in Toronto-based Li-Cycle to acquire 2.6 percent of the largest battery recycling company in North America. Under the agreement, LG Chem will be provided 20,000 tons of recycled nickel for 10 years starting 2023.
LG Chem aims to go carbon neutral by 2050.
LG Chem was only company that Yellen had plans to visit during her visit to Korea.
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