[News Article] LG Energy Solution expands investment to overcome EV market 'chasm'
LG Energy Solution
expands investment to overcome EV market 'chasm'
BY JEONG SEONWU, Korea
JoongAng Daily - LG Energy Solution views the current situation in the EV
market as a stagnation phase, known as the “chasm,” which occurs just before
the widespread adoption of the vehicles. The company believes
that by maintaining active investment during this period, it will be able to
gain a first-mover advantage in North America as well as the rest of the world
as the market enters a phase of full-scale growth. In April, LG Energy
Solution announced that the first battery cell produced at Ultium Cells, its
joint venture with GM, had been delivered to a customer. The batteries
produced at this plant are set to be installed in GM's new third-generation EV
models, including the Cadillac Lyriq. Ultium Cells' second
plant plans to gradually increase its production lines to expand its total
production capacity to 50 kilowatt hours (kWh). This capacity is
sufficient to produce approximately 600,000 high-performance pure EVs capable
of traveling over 500 kilometers (310 miles) on a single charge. Ultium Cells is
operating and constructing a total of three production plants to target the
North American EV market. The first plant,
located in Lordstown, Ohio, began operating in November 2022 and has maintained
a high yield rate from the start, ensuring stable production. The third plant,
being built in Lansing, Michigan, is on track to commence full-scale operations
next year. The total investment
for Ultium Cells' first, second and third plants amounts to 9 trillion won
($6.6 billion). Once all three
plants are fully operational, their combined production capacity is expected to
reach 145 gigawatt hours (GWh). In addition to its
joint venture plants, LG Energy Solution is also continuing to invest in
standalone factories. Recently, the
construction of the company’s battery production plant located in Arizona in
the United States began. The plant’s
significance lies in that it is the company’s first production facility
dedicated to cylindrical batteries and energy storage systems (ESS). The plant is
expected to have a production capacity of 36 GWh for cylindrical batteries and
17 GWh for ESS LFP batteries, bringing the total production capacity to 53 GWh. At the Arizona
cylindrical battery plant, production of the 46-Series batteries for EVs is
scheduled. The 46-Series, often
referred to as the next-generation battery, has attracted significant attention
from major global customers even before production began. LG Energy Solution
previously announced plans to commence mass production of cylindrical 4680
batteries at its Ochang Energy Plant in the second half of this year, making it
the most advanced production among major global battery manufacturers. At the ESS battery
plant, LG Energy Solution plans to produce pouch-type lithium iron phosphate
(LFP) batteries developed independently by the company. By localizing
production in the United States, the company aims to secure price
competitiveness through reduced logistics and tariff costs. The company also
plans to provide differentiated customer value through immediate on-site
support and management services to meet customer demands. LG Energy Solution
will now have the most diverse and competitive product portfolio among battery
companies in the North American region, encompassing not only pouch-type and
cylindrical batteries for EVs but also LFP batteries for ESS. A representative
from LG Energy Solution said, “We will overcome the chasm phenomenon through
portfolio expansion based on technological leadership.” Source:https://koreajoongangdaily.joins.com/news/2024-05-28/business/guestReports/LG-Energy-Solution-expands-investment-to-overcome-EV-market-chasm/2056387
2024.05.31