Crain’s Detroit Business reports that Michigan officials intend to renegotiate an incentive deal with Ultium Cells LLC after GM announced it would exit the Ultium Cells battery plant in Lansing. GM was awarded a $666 million grant package in 2022, which was paid out before the Lansing battery plant and Orion Township EV expansion were completed.
The Lansing Ultium cells plant is part of the Ultium joint venture between GM and LG Energy Solution. GM announced earlier this month its intention to sell its stake in the Lansing plant to LG in an effort to recoup its $1 billion investment.
“One of the things that collectively we’ve said is that we will have to go and renegotiate those grants agreements because now GM will not have any employment at (the Lansing plant),” Michigan Economic Development Corp. (MEDC) CEO Quentin Messer said in an interview. “Their sole employment is going to come from the Lake Orion facility, and so that’s going to require us to do a rewrite of those agreements that we’ll be undertaking the first quarter of calendar year 2025.”
The grants were part of Michigan’s SOAR (Strategic Outreach and Attraction) fund, which was initially a $1.5 billion project to keep Michigan businesses’ investments in the Wolverine State. It was a response to Ford’s substantial $11 million EV investments in Kentucky and Tennessee.
Ultium Cells is arguing that neither GM nor LG were recipients of SOAR funds. “Neither General Motors nor LG Energy Solution received any incentive funds related to the Ultium Cells Lansing facility,” Ultium Cells spokeswoman Katie Burdette said in an email to Crain’s. “Ultium Cells LLC was the recipient of the incentive package from the state of Michigan for the Lansing facility. All parties are working to ensure the Lansing investment and related incentives remain intact, so its benefits to Michigan and the community can be realized.”
This funding is under scrutiny partially because of ongoing controversy around $250 million in state money funding the partial demolition and revitalization of Detroit’s Renaissance Center as GM is in the process of moving its headquarters to Hudson’s Detroit. GM has threatened to bear the expense of demolishing all five towers that comprise the Renaissance Center if the public funding doesn’t come through.
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