South Korea's LG Energy Solution, which counts Tesla Inc (NASDAQ: TSLA) and Lucid Group Inc (NASDAQ: LCID) as customers, is reportedly investing $7.2 billion to build new battery plants in North America including two in the U.S. and one in Canada.
$1.4B Boost For Arizona: LGES plans to pump in $1.4 billion to build a battery factory in Arizona by 2024, Reuters reported on Wednesday, citing the company.
The first U.S. facility to make cylindrical cells will cater to demand from “prominent startups” and North American clients. Tesla and Lucid use cylindrical cells.
The battery supplier plans to begin construction in the second quarter this year and aims to begin production in 2024, according to the report.
$1.7B For Michigan Plant: LGES will invest $1.7 billion in an existing, wholly-owned lithium-ion battery cell plant in Holland, Michigan, according to the Michigan Economic Development Corporation (MEDC).
The facility, built in 2010, makes large lithium-ion polymer battery cells and packs for electric vehicles.
“As the future of the electric vehicle industry grows, LG Energy Solution needs the additional capacity to allow for the production, testing, and storage of materials needed for battery manufacturing,” MEDC said.
Canada Gets $4.1B JV Investment: LGES said on Tuesday it would invest more than $4.1 billion in a joint venture with Stellantis NV — a merger between Fiat Chrysler Automobiles and PSA Group — to build a new EV battery plant in Windsor, Canada.
The 45 gigawatt-hour plant will make lithium-ion battery cells and modules and is expected to begin operations in 2024.
See Also: Tesla, GM EV Battery Supplier LG Energy Poised to Price IPO At Top of Range: Report
Why It Matters: LG Energy Solution raised more than $10 billion in January for local listing. The heavyweight IPO follows LGES’ decision to pay its customer General Motors Corp (NYSE: GM) $1.2 billion over the legacy automaker’s Chevrolet Bolt EV and Bolt EUV recall last year.
Asian battery makers that currently dominate the EV market have been expanding their presence in China, the U.S., and Europe as automakers rush to secure supply chains.
China’s CATL is the global frontrunner in battery making for electric vehicles followed by LG Energy and Japan’s Panasonic.
Price Action: Tesla stock closed 0.5% higher at $999.1 a share on Wednesday.
