The U.S. Department of Energy (DOE) has announced the closing of a $2.5 billion loan to Ultium Cells LLC – a joint venture between General Motors and LG Energy Solution. This loan, made possible by the DOE’s Loan Programs Office, will help finance the creation of three previously-announced Ultium Cells plants.
Specifically, this loan will be used to facilitate the construction of the following Ultium manufacturing plants:
- Ultium Cells in Lordstown, Ohio
- Ultium Cells in Spring Hill, Tennessee
- Ultium Cells in Lansing, Michigan
This project is forecasted to create more than 11,000 jobs, including 6,000 in construction and 5,100 in operations, across all three facilities.
These battery plants will produce modular Ultium battery cells that will be used in GM electric vehicles, which will include cars, trucks, and – interestingly, per the DOE’s press release – busses. The objective of the loan is to facilitate GM’s plan to field 30 EVs by 2025, as well as respond to tightening emissions regulations.
The funds for the loan represent the first closed loan sourced from the Loan Programs Office’s Advanced Technology Vehicles Manufacturing (ATVM) program. In the past, the ATVM loan program has issued loans to Tesla, Ford and Nissan, some of which was applied toward battery cell manufacturing.
This financing effort compliments President Joe Biden’s Inflation Reduction Act, which provides billions for EV-related infrastructure and supply chain investment. The news comes on the heels of the Biden administration setting a goal calling for 50 percent of U.S. automobile production to be electric or plug-in electric hybrid vehicles by 2030.
Furthermore, the Inflation Reduction Act provides an additional $3 billion towards ATVM loan costs and expanded use to larger vehicles, maritime vessels, aviation, and other transportation modes, providing an avenue for future investments.
The announcement of this loan to Ultium Cells LLC comes as no surprise, as GM Authority reported back in July 2022 that the U.S. DOE intended to provide the financing.