GM to sell stake in battery cell plant to LG partner for $1 billion

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GM to sell stake in battery cell plant to LG partner for $1 billion

General Motors revealed its all-new modular platform and battery system, Ultium, on March 4, 2020 at its Tech Center campus in Warren, Michigan.

Photo by Steve Fecht for General Motors

DETROIT — General Motors plans to sell its stake in a $2.6 billion electric vehicle battery cell plant in Michigan to its ****** venture partner LG Energy Solution, the automaker announced Monday.

The Detroit carmaker said it expects to recoup its investment in the facility, which a source familiar with the plans said is anticipated to be roughly $1 billion. The ***** is part of a non-binding agreement between the two companies that’s anticipated to close during the first quarter of next year, GM said.

The nearly completed, 2.8 million-square-foot plant in Lansing, Michigan, was expected to be the third battery cell facility of the ****** venture, known as Ultium Cells LLC, following plants in Ohio and Tennessee that have already opened and are operational.

The Lansing plant was announced in January 2022, and the two companies first announced their ****** venture five years ago.

GM’s move comes as the automaker attempts to right-size production of electric vehicles and confronts slower-than-expected consumer demand. It also comes amid uncertainty regarding federal incentives for manufacturing and purchasing EVs in the U.S. under President-elect Donald Trump.

The automaker said the ***** does not impact its overall ownership stake in the ****** venture or its future plans for a separate ****** venture plant with LGES rival Samsung SDI.

GM CEO and Chairman Mary Barra and LG Chem Vice Chairman and CEO Hak-Cheol Shin at the automaker’s battery lab in Warren, Mich., where the companies announced a new $2.6-billion ****** venture on Dec. 5, 2019.

GM

“We believe we have the right cell and manufacturing capabilities in place to grow with the EV market in a capital efficient manner,” GM CFO Paul Jacobson said in a release. “When completed, this transaction will also help LG Energy Solution meet demand by leveraging capacity that’s nearly ready to come online and it will make GM even more efficient.” 

GM said the South Korean battery supplier will have immediate access to the Lansing facility to begin installation of equipment. The plant, which currently employs nearly 100 people,

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by the end of this year.

Separate from the ***** of its stake in the Lansing facility, GM on Monday announced it will extend a 14-year battery technology partnership with LGES to include the development of an emerging type of battery cell called prismatic cells.

Prismatic cells are a flat, rectangular shape with a rigid enclosure, which allows for space-efficient packaging within battery modules and packs. GM said the cells are expected to reduce EV weights and costs, while simplifying manufacturing by reducing the number of modules and mechanical components.

“We’re focused on optimizing our battery technology by developing the right battery chemistries and form factors to improve EV performance, enhance safety, and reduce costs. By extending our partnership with LG Energy Solution, we’re taking an important step towards these goals,” Kurt Kelty, GM vice president of battery cell and pack, said in a release.

GM had previously said it planned to expand its battery cell technologies from its flat “Ultium” pouches to include other forms such as prismatic cells.

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