[Alpha Biz= Reporter Kim Jisun] The construction of the third electric vehicle (EV) battery plant in the U.S. by Ultium Cells, a joint venture between LG Energy Solution and General Motors (GM), has been temporarily halted.
According to industry sources on the 21st, Ultium Cells recently suspended the construction of its third plant in Lansing, Michigan, which was initially slated to begin operations next year.
However, this suspension is not a complete stoppage or withdrawal. The construction is expected to resume after closely monitoring market conditions.
The third Ultium Cells plant, with a total investment of $2.6 billion (approximately 3.6 trillion KRW), was initially set to begin construction in 2022 and complete in the second half of this year. The plant was planned to start phase one of mass production early next year and expand its annual production capacity to 50 GWh (gigawatt-hours).
However, due to the EV market's current challenges, major EV manufacturers are revising their strategies.
GM announced it would cut this year's EV production to 200,000-250,000 units, 50,000 fewer than previously planned. Ford has decided to increase investments in internal combustion engine vehicles instead of EVs. Tesla has also delayed its plan to build a new plant in Mexico.
In response, EV battery manufacturers are adjusting their pace. The temporary halt of the third Ultium Cells plant is part of this adjustment.
Recently, LG Energy Solution also temporarily suspended the construction of its dedicated lithium iron phosphate (LFP) battery plant for energy storage systems (ESS) in Arizona, only two months after breaking ground.
Meanwhile, LG Energy Solution is expected to outline its future investment plans, including the temporary suspension of the third Ultium Cells plant, during its second-quarter earnings announcement on the 25th. Currently, Ultium Cells operates its first plant in Ohio and its second plant in Tennessee.
AlphaBIZ Kim Jisun(stockmk2020@alphabiz.co.kr)
