Why LG and GM are Building a Giant Battery Plant for $2.3 Billion
The electric car industry is rapidly growing, with Tesla leading the way. Other car manufacturers, including newcomers, have been forced to focus on the development of electric vehicles. One critical component in the production of electric cars is the battery. According to forecasts, over 20 million registered electric cars will be on the road by 2030, each requiring an efficient and high-tech battery capable of delivering exceptional performance. LG and GM have partnered to build a giant battery plant for $2.3 billion. This article will delve into why they made this investment.
General Motors (GM) is the largest American corporation in the production of automobiles and has been a leader in the industry for over a hundred years. The company had a tough beginning in the 21st century, which led to its bankruptcy and the sale of 72% of its shares to the US and Canadian governments. This caused a massive reshaping of the corporation, and the company began revamping for an electric future, inspired by Tesla’s revolutionizing the auto industry.
Earlier this year, GM declared plans to abandon internal combustion engines altogether by 2035 and switch to zero-emission vehicles. The company intends to invest $27 billion in electric cars by 2025, an investment aimed at ensuring that the production of electric cars constitutes a more significant proportion of sales than the meager 20,000 electric Chevy Bolts sold out of 2.55 million cars in 2019.
GM and LG’s Partnership
The joint venture between GM and LG involves the production of batteries for electric vehicles. The partnership was created to help meet the rapidly growing demand for electric cars. In 2020 the companies announced the creation of a joint venture plan for the production of batteries for electric cars, named the Altium Cells, with a capacity located in Lordstown, Ohio. The construction’s principal phase is complete, and the capacity declared will be 30 gigawatt-hours.
The spring hill Tennessee plant will be in collaboration with the GM automaker and LG and is an example of fruitful work between a battery manufacturer and automaker. The facility is an innovative platform where LG and GM plan to launch a new generation of products. The batteries for the newly unveiled Cadillac Lyric crossover, slated for production in late 2022, will be received from this factory.
Comparison with Tesla and Other Automakers
General motors is rapidly ramping up battery production to compete with other significant players in the electric vehicle industry like Tesla, Audi, and Volkswagen. However, there are key differences between the production methods used by these players. In some cases, battery manufacturers sell their products outright to automakers (Volkswagen). In other cases, automakers seek joint venture partnerships with battery manufacturers, as seen with GM and LG. Tesla, on the other hand, aims to establish its production of storage cells, relying solely on its own capacities.
The electric vehicle industry is expanding, and major automakers are investing heavily in their future through the development of electric cars. General Motors, in collaboration with LG, launched a battery plant in Spring Hill, Tennessee, to make storage cells for electric vehicles. This partnership is aimed at meeting the growing global demand for electric cars. The competition in the electric vehicle market is immense, with industry leaders like Tesla and traditional automakers like GM competing for dominance. As the world moves towards an electric future, the production of storage cells becomes increasingly important, and partnerships such as GM and LG are critical.