June 14, 2024

A South Korean battery maker said it would quadruple its planned investment in a new plant in Arizona to meet growing demand from automakers trying to ramp up production of electric cars and trucks.

The company, LG Energy Solution, said it would invest $5.5 billion to build the complex near Phoenix and plans to produce batteries for electric vehicles in 2025 and for energy storage systems next year.

LG said its decision was driven in part by the Inflation Reduction Act, which became law in August and included federal incentives for the sale and production of electric vehicles and batteries in the United States. LG is one of the world’s largest makers of batteries for electric vehicles and energy storage devices, and its customers include General Motors, Ford Motor, Honda and Tesla.

“We believe this is the right move at the right time to advance America’s clean energy transition,” CEO Youngsoo Kwon said in a statement.

The multibillion-dollar investment is the latest in battery and car companies since President Biden signed the Lower Inflation Act.

Last month, Ford said it would build a $3.5 billion battery factory in Michigan that will use technology and services from China’s CATL, the world’s largest battery maker. Ford is also building battery plants in Kentucky and Tennessee with another Korean company, SK On.

In December, the Energy Department said it would provide a $2.5 billion loan to Ultium Cells, a joint venture between General Motors and LG, to build battery factories in Ohio, Tennessee and Michigan. Honda and LG are also investing $3.5 billion to build a battery plant in Ohio.

A wave of new factories is expected to increase battery manufacturing capacity in North America tenfold from 2021 to 2030 a recent report From Argonne National Laboratory.

Manufacturing batteries in the U.S. could help lower EV prices by reducing shipping costs while reducing reliance on China, which dominates the battery supply chain. In addition, the Biden administration is trying to encourage domestic mining and processing of battery raw materials such as lithium, and to speed up the construction of electric vehicle chargers along highways.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *