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GM is close to building a second EV battery factory in the US, report says

GM is close to building a second EV battery factory in the US, report says


The plant will be built with South Korea’s LG Chem

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Illustration by Alex Castro / The Verge

General Motors is considering building a second battery factory in the United States, The Wall Street Journal reports, in order to ramp up its production of electric vehicles in the interest of becoming a completely carbon neutral company by the year 2040.

The factory would be built in collaboration with LG Chem, the South Korean battery maker that is already working with GM on a battery factory in northern Ohio. According to the Journal, the second facility is likely to be located in Tennessee, though a final location has yet to be selected. A spokesperson for GM confirmed that a second factory is being discussed with LG Chem, and a decision is expected sometime in the first half of 2021.

GM announced the construction of its first battery factory in December 2019. The automaker set up a joint venture with LG Chem, with the two companies committing to spend $2.3 billion on a new facility located in Lordstown, Ohio.

GM is increasingly staking its future on electric vehicles

GM, the largest automaker in North America based on sales, is increasingly staking its future on electric vehicles. The company has vowed to spend $27 billion on the development and production of 30 new electric vehicles by 2025, more than two-thirds of which will be available in North America. GM even redesigned its logo to look more like an electrical plug to emphasize its pivot to battery-powered vehicles.

LG Chem is a major supplier of lithium-ion batteries to automakers like Audi, Mercedes-Benz, and their respective parent companies Volkswagen Group and Daimler. Many of these automotive giants have plans to either build their own battery factories in the future or partner with suppliers to build batteries together, like Tesla does with Panasonic. Tesla has also announced plans to bring its future battery production in-house, and it recently announced a deal with a major producer of nickel. But until those factories are built, they’re at the mercy of suppliers like LG Chem.

The auto industry as a whole is slowly shifting to electric vehicles, and if the US wants to compete with the rest of the world, it needs to ramp up its supply of locally produced EV batteries in addition to other crucial components in the supply chain. SK Innovation, another South Korean company that supplies batteries to Volkswagen and Ford, began construction on its second US-based factory in July in Georgia with production aimed for 2023.

President Joe Biden recently signed a series of executive orders aimed at combating climate change, including the electrification of the federal government’s fleet of vehicles. The new administration has provided an opportunity for GM to fully embrace the electrification of its vehicle lineup as well as shrug off its past support of former President Donald Trump’s effort to allow passenger vehicles to pollute more.