The Michigan branch of LG Energy Solution has confirmed a $ 1.36 billion investment in an electric vehicle battery plant in North America by 2024, according to Korean regulatory documents released on Monday.
The $ 1.36 billion funding will be used to expand its annual production capacity to the United States, Canada and Mexico. Its current capacity is 5 gigawatt hours, according to company spokeswoman Ashlee Semin Shin, who confirmed the capacity of Detroit News. It’s unclear where the investment will land, and Michigan isn’t 100% going to see the money, despite having a plant in Holland, Michigan.
LG has joint ventures with GM and Jeep and Ram’s parent company, Stellantis.
Detroit would probably be an ideal location for LG Energy Solution to expand its battery capacity in North America for electric vehicles in particular. As traditional automakers continue to expand their electrification efforts, Detroit, being the center of America’s auto industry for the past century, is transitioning into a world of vehicle development and potential. electric. While businesses stationed in this area are generally slow to adapt to change, especially when it comes to ditching the ICE engines they’ve built for decades and made billions of dollars in, the effort is there.
The American auto industry is changing slowly. Recent estimates have capped the US electric vehicle market at 2.4% at the end of 2020, which is an increase of almost 25% from 2019. 2021 could see even greater progress in the number of cars. electric on American roads, but the problem is that powering them electric cars requires batteries, which even the most established companies are struggling to find. Tesla, for example, has delayed several projects including the Next Generation Semi and Roadster program due to battery cell constraints. Tesla uses LG Chem batteries, parent company of Panasonic, CATL and LG Energy Solution, for its vehicles around the world.
LG Energy Solution confirmed its IPO on the Korea Exchange in June and said in a filing that it would raise $ 681 million in capital while receiving the rest of the funding as a loan (via Detroit News):
“Through the capital increase, we plan to use it as an investment fund to meet the increased demand for electric vehicle batteries and (energy storage systems) in the North American market. We plan to invest billions of dollars.
Earlier this year in March, LG pledged to spend $ 4.5 billion by 2025 to increase battery capacity in the United States to 70 GWh, which would create 10,000 jobs.
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