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General Motors is selling its stake in its nearly completed Ultium Cells battery cell plant in Lansing, Michigan, to its joint venture partner LG Energy Solution (LGES). GM’s move from the plant comes amid weak demand for electric vehicles and a potential rollback of the Biden administration’s incentives to produce clean energy domestically.
GM and LGES initially teamed up in 2019 to form a joint venture to mass produce battery cells for electric vehicles. Since then, the two have pumped billions into three plants: the Lansing facility acquired by LGES; The Spring Hill, Tennessee, facility begins production in 2024; and the Lordstown, Ohio, plant, which has been producing battery cells since 2022. Cells produced at the Ohio and Tennessee plants power vehicles such as the Chevrolet Silverado EV, GMC Sierra EV, Cadillac LYRIQ, Chevrolet Blazer EV, and Chevrolet Equinox EV, as well as the GMC Hummer EV pickups and SUVs.
In October, GM dropped the Ultium battery brand name as part of its move to embrace new cell types and chemistries, such as lithium iron phosphate (LFP) batteries.
GM helped pave the way for the movement among automakers and battery manufacturers to produce onshore batteries after the COVID-19 pandemic. President Joe Biden’s Inflation Reduction Act, which he signed in August 2022, includes incentives geared toward helping the United States reduce dependence on China for batteries, and has served as a catalyst for a wave of new battery projects.
Aside from LGES, GM also announced a joint venture with Samsung SDI to build a new battery factory in the US in April 2023, and is working with a few startups dedicated to promoting new battery technology.
News of GM’s non-binding agreement with LGES comes a few months later Reports that GM and LGES were slowing construction of the Lansing plant, which was expected to begin production in 2025. LGES did not respond in time to TechCrunch to confirm whether that timeline was still accurate, nor whether the company still expected The factory’s capacity will reach 45 gigawatt hours at peak production.
Neither company shared the acquisition price, but a GM spokesman said the company expects to recoup its initial investment. GM said in a statement that it expects the two remaining plants to be sufficient to meet current demand.
GM has not announced how much LGES will buy the plant for, but a company spokesman said GM expects to recoup its initial investment. GM and LGES initially announced a $2.6 billion investment in the plant, but it’s not clear how much each company spent.
GM also announced Monday that it will work with LGES to jointly develop prismatic battery cells. Levy declined to reveal whether these cells will be produced at one of the joint venture’s remaining sites, or whether they will be manufactured at a facility that has not yet been announced.
At plants in Ohio and Tennessee, GM and LGES focused on making bag cells, which are less expensive and more flexible in shape. Prismatic cells, although heavier and more expensive, have higher power density, longer cycle life, and better heat management.
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