Mary Barra, CEO and chairman of GM, speaks during an “EV Day” on March 4, 2020 at the company’s technology and design campus in Warren, Michigan, a suburb of Detroit
The facility for the Ultium Cells LLC joint venture is intended to support GM’s production Cadillac Lyriq crossover and other future electric vehicles at a nearby assembly plant.
Construction of the 2.8 million square meter facility will begin immediately. The plant is scheduled to open at the end of 2023 and will create 1,300 jobs, according to the companies.
“The addition of our second brand new Ultium battery cell facility in the US with our joint venture partner LG Energy Solution is another important step towards an all-electric future,” said Mary Barra, CEO of GM, in a press release.
The announcement comes in the middle a 100 day review appointed by President Joe Biden of the US Advanced Batteries, Pharmaceuticals, Critical Minerals and Semiconductors Supply Chain. He ordered the review in the face of an ongoing global shortage of semiconductor chips This had a significant impact on U.S. auto production in 2021.
Jong Hyun Kim, president and CEO of LG Energy Solution, said the new facility will enable companies to “build solid and stable supply chains in the US that enable everything from research, product development and manufacturing to sourcing raw components.”
Some analysts, particularly Adam Jonas of Morgan Stanley, have warned of a potential shortage due to cell capacity compared to the amount of new electric vehicles expected to hit the market in the coming years.
“We believe GM’s establishment of Ultium / Ultium Cells LLC will prove to be a critical point in the strategic differentiation that will ultimately drive value for shareholders,” he said in a statement to investors on Wednesday.
Ultium is GM’s next generation battery and platform, expected to be launched this year in 2000 GMC Hummer EV pickup. The first vehicles are not expected to contain Ultium battery cells from the Ohio facility under construction.
An undated flyer photo shows the new Cadillac Lyriq, one of the electric vehicles General Motors Co said the Spring Hill, Tennessee plant will begin production on Oct. 20, 2020.
General Motors Co. | Reuters
GM is expected to continue building or converting facilities in the US to become an electric-only automaker by 2035. This includes at least 30 new electric vehicles by 2025 under $ 27 billion Investment facility for electric and autonomous vehicles during this period.
Most batteries like semiconductors, are made in Asia and Europe. Tesla operates a huge production facility for batteries and cells with Panasonic in Nevada. Tesla announced in September that it had started producing its own cells at a pilot facility in Fremont, California.
GM and LG first announced the joint venture in December 2019.