GM CEO and President Mary Barra and LG Chem Vice President and CEO Hak-Cheol Shin on the automaker’s battery lab in Warren, Michigan, where the businesses announced a new $2.6 billion three way partnership on December 5, 2019.
GM
DETROIT- General Motors and LG Energy Solution have indefinitely postponed plans to build a fourth battery cell plant within the US as talks between the 2 sides recently ended without an agreement, a person acquainted with the plans confirmed to CNBC.
The Detroit-based automaker is expected to proceed with plans to build a plant but is looking for one other partner, according to a one who asked to remain anonymous since the talks are private.
“We now have made it very clear that our plan includes an investment in a fourth cell plant within the US, but we are usually not going to comment on speculation,” GM said in an emailed statement.
Wall Street Journal first reported Talks between GM and LG stalled on Friday afternoon as LG Energy Korea executives were hesitant to commit to the project given the rapid pace of recent investments with other automakers in addition to uncertain macroeconomic prospects.
The newspaper, citing unnamed sources acquainted with the plans, reports that GM is in talks with at the least one other battery supplier to proceed with the development of a fourth U.S. cell plant.
The breakdown in talks got here after GM CEO Mary Barra and other executives said they’d been close to announcing details for a fourth plant to be inbuilt Indiana for a while.
GM and LG initially announced a three way partnership to build a $2.3 billion plant in Ohio in December 2019, followed by other factories near GM’s plants in Michigan and Tennessee. Currently, only the Ohio plant is operational, while others are under construction. The three way partnership is called Ultium Cells LLC.
An Ultium spokeswoman directed questions to GM and LG Energy. In an emailed statement, LG Energy said that discussions for a fourth Ultium cell plant “remained ongoing between LG Energy Solution and GM, but no decision has been made.”
The connection between GM and LG Energy is central to the automaker’s future plans for electric vehicles, including overtaking Tesla and others to develop into the US leader in all-electric vehicle sales. The Detroit automaker is expected to launch several new electric vehicles this 12 months, including mass-market vehicles corresponding to the Equinox, Blazer and Silverado.
GM in its Friday statement said its second and third plants together with LG are heading in the right direction to open as planned in 2023 and 2024 respectively. The corporate also confirmed that it is heading in the right direction to reach 1 million electric car production capability per 12 months in North America by 2025.