General Motors unveiled its all-new modular platform and battery system, Ultium, at its technology center campus in Warren, Michigan, on March 4, 2020.
Photography by Steve Fichte for General Motors
DETROIT — GM The automaker plans to sell its stake in a $2.6 billion electric vehicle battery cell plant in Michigan to its joint venture partner LG Energy Solution, the automaker announced Monday.
The Detroit automaker said it expects to recoup its investment in the facility, which a source familiar with the plans said is expected to be roughly $1 billion. GM said the sale is part of a non-binding agreement between the two companies that is expected to close during the first quarter of next year.
The nearly completed, 2.8 million-square-foot plant in Lansing, Michigan, was expected to be the third battery cell facility in the joint venture, known as Ultium Cells LLC, after plants in Ohio and Tennessee that are already up and running.
The Lansing plant was announced in January 2022, and the two companies first announced their joint venture five years ago.
GM's move comes at a time when the automaker is trying to adjust the volume of electric vehicle production and confront slower-than-expected consumer demand. It also comes amid uncertainty over federal incentives for manufacturing and purchasing electric vehicles in the United States under President-elect Donald Trump.
The automaker said the sale does not affect its overall ownership stake in the joint venture or its future plans to set up a separate joint-venture plant with LGES rival Samsung SDI.
CEO and Chairman Mary Barra and LG Chem Vice Chairman and CEO Hak-Cheol Shin at the automaker's battery lab in Warren, Michigan, where the two companies announced a new $2.6 billion joint venture on December 5, 2019.
GM
“We believe we have the right cells and manufacturing capabilities to grow with the electric vehicle market in a capital-efficient manner,” Paul Jacobson, GM's chief financial officer, said in a statement. “When completed, this transaction will also help LG Energy Solution meet demand by leveraging capacity that is almost ready to come online and will make GM more efficient.”
GM said the South Korean battery supplier will have immediate access to the Lansing facility to begin installing the equipment. The factory, which currently employs nearly 100 people, is expected to start operating by the end of this year.
Separate from the sale of its stake in the Lansing facility, GM announced Monday that it will extend its 14-year battery technology partnership with LGES to include development of an emerging type of battery cell called prismatic cells.
Prismatic cells are a flat, rectangular shape with a rigid housing, allowing for space-saving packaging within battery modules and packs. GM said the cells are expected to reduce the weights and costs of electric vehicles, while simplifying the manufacturing process by reducing the number of modules and mechanical components.
“We are focused on improving our battery technology by developing the right battery chemistries and form factors to improve electric vehicle performance, enhance safety, and reduce costs. By expanding our partnership with LG Energy Solution, we are taking an important step toward these goals,” said Kurt Kelty, vice president of LG Energy Solution. Motors for the battery cell and battery pack, in a press release.
GM had previously said it plans to expand battery cell technologies from its Ultium flat-pack to include other shapes such as prismatic cells.
