GM and LG Energy are no longer planning the build a new Ultium battery production facility in Indiana, a recent report states.
Per The Wall Street Journal, talks between GM and LG Energy have ended without an agreement regarding a fourth Ultium battery plant in the U.S. So far, GM and LG Energy have three U.S. battery facilities in place, one of which is already in operation in Ohio. The other two are currently under construction in Tennessee and Michigan, with a total investment of more than $6.5 billion.
The new facilities were developed under Ultium Cells LLC, a joint venture between GM and South Korean battery supplier LG Energy. The two companies originally had plans to launch a fourth facility in Indiana, but according to the report, talks have ended without an agreement due to hesitation on the part of LG Energy over the rapid pace of LG’s most recent U.S. investments, which also include a new battery facility in Ontario with Stellantis, and a joint factory in Ohio with Honda. The report goes on to state that an uncertain macroeconomic outlook is another factor in LG’s hesitation to invest in a fourth battery facility with GM.
GM and LG Energy have also reportedly disagreed over the rate at which production should be ramped up at the Ohio facility, with GM pushing for a faster production start than LG executives. Unionization has been another sticking point, with GM supporting a less-formal, faster “card check” process, and LG supporting a formal election. Workers at the Ohio facility voted for representation by the United Auto Workers in December.
GM is apparently still considering Northwest Indiana as the location for a new battery cell facility. Going forward, GM is reportedly in discussions with at least one other battery supplier to lock in a fourth U.S. production facility.
This massive influx of new battery cells is required for GM to hit its stated goal of producing 400,000 EVs by the 2024 calendar year. The goal was originally to hit 400,000 units by the end of 2023, but the date was pushed back six months to early 2024 due to a “slightly slower launch” of battery and cell production.