LGES (LG Energy Solution) has reportedly announced to build a battery factory for USD 1.4 billion in Arizona by 2024 to cater to demand from eminent start-ups and other customers in North America.
This will be the first factory in the U.S. to make cylindrical cells, a battery type that is used in Lucid and Tesla vehicles. Construction will commence in the Q2 of this year, with mass productions to initiate in 2024 with a production capacity of around 11 gigawatt-hours.
Earlier, credible reports suggested that potential consumers would comprise EV manufacturers Lucid, Tesla, and Philip Morris, maker of IQOS heated tobacco sticks, and Proterra.
LGES intends to consider encompassing more production capacity at its Arizona facility in the future. A company official stated that the Arizona facility could further add its capacity as it witnesses surging demand for cylindrical batteries from different customers which includes power tool makers and automakers.
Elon Musk, the Chief Executive Officer of Tesla, stated that the production of batteries would be a limiting factor to produce vehicles in two to three years. Mr. Musk has urged suppliers to amp production while his company starts making in-house cells.
Japan-based Panasonic Corp, one of Tesla’s suppliers, and Contemporary Amperex Technology Co Ltd seek to invest billions of dollars to develop a factory to make a new EV battery type for Tesla. Panasonic looks at constructing the factory in either Kansas or Oklahoma.
Last month, Sherry House, the Chief Financial Officer of Lucid signed multiyear supply deals with two battery suppliers, and the deal does include some capacity from state-side cell lines. However, the CFO did not reveal the names of the companies.
LGES, which secured over USD 10 billion in its IPO (initial public offering) in Korea, has announced various battery joint ventures with Stellantis and GM in Canada and the United States.
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