General Motors is Looking to Build a Second Electric Vehicle Battery Plant in the U.S.

author: Eric Walz   

GM's newly unveiled logo resembles an electrical plug and hints at its electric future.

Automaker General Motors has made clear its electrification plans. The company is investing up to $27 billion to electrify its model lineup and introduce up to 30 new battery-powered vehicles globally by 2025. So the automaker will need a steady supply of EV batteries to support its goals.

On Thursday, the Wall Street Journal reported that GM is looking to build a second battery plant in the U.S. with its South Korean battery partner LG Chem, citing people familiar with the company's plans.

LG Chem is currently the battery supplier for GM's Chevy Bolt EV.

According to the report, the two companies are close to an agreement to build the new plant in Tennessee.

GM and LG Chem are already investing up to $2.3 billion in a battery factory in Ohio. Plans for the joint venture battery factory in Northeast Ohio located near GM's shuttered Lordstown assembly plant were first announced in Dec 2019. The facility is currently under construction. 

The Ohio plants will build GM's new Utium batteries, which will power a majority of GM's future electric models.

GM's Ohio battery plant will be a state-of-the art facility, using advanced manufacturing processes to produce battery cells more efficiently, with little waste, according to GM. It's also designed to be flexible enough to adapt to new advancements in EV battery technology.

Last year, GM said its joint venture battery factory with LG Chem will drive battery cell costs below $100/kWh the automaker says, roughly 40% less than they cost now. The new battery cells will use a proprietary low cobalt chemistry and improvements in manufacturing will help reduce costs even further. 

The $100 per kWh cost is considered to be the price point where electric vehicles will cost roughly the same as internal combustion engine powered models. 

GM also said its open to the idea of licensing the battery cells to other companies, including for energy storage systems like Tesla's Powerwall energy storage systems.

Tennessee will also be the home of German automaker Volkswagen's new U.S. battery factory, which will include production lines for both battery cells and packs for the company's future electric models sold in North America. Volkswagen is building a state-of-the-art high-voltage laboratory designed to develop and test electric vehicle cells and battery packs at the plant.

Most of the world's EV batteries are manufactured by companies in Asia, Some of the leading producers are LG Chem, and China's Contemporary Amperex Technology Limited ( CATL). 

CATL is its battery supplier for Tesla's China-made Model 3, which is being built at the company's factory near Shanghai. The batteries for Tesla's U.S.-built vehicles are made in Nevada at a joint venture battery factory with Panasonic.

The Tennessee location seems like a good choice for GM. The automaker announced in Oct 2020 that it will invest $2 billion in its Spring Hill, Tennessee Manufacturing facility to build fully-electric vehicles, including the upcoming Cadillac LYRIQ crossover, the first electric vehicle from GM's luxury division. The plant has produced nearly 4.5 million GM vehicles since 1996.

Now that the Spring Hill plant is being retooled to produce EVs, having a battery plant nearby would be beneficial for GM. The automaker is aiming for EVs to make up 40% of its U.S. models by the end of 2025. However, GM's long term electrification goals are more aggressive.

In January, GM announced it plans to become a carbon neutral company by 2040. To reach its goal, the automaker plans to phase out internal combustion engine models entirely, including light-duty trucks and SUVs by 2035. It's a bold decision for a company that has been building gas-powered vehicles since 1908.

A large part of GM's initiative will rely upon the production batteries at scale.

Eric Walz

Originally hailing from New Jersey, Eric is a automotive & technology reporter covering the high-tech industry here in Silicon Valley. He has over 15 years of automotive experience and a bachelors degree in computer science. These skills, combined with technical writing and news reporting, allows him to fully understand and identify new and innovative technologies in the auto industry and beyond. He has worked at Uber on self-driving cars and as a technical writer, helping people to understand and work with technology.