Stellantis and LG Energy Solution have promised to build a battery factory for cells and packs somewhere in North America. While a location was not announced or hinted at, the start date is penciled in for the first quarter of 2024. What’s behind the decision?
Stellantis has a goal of over 40 percent EV sales in the U.S. by 2030. To do that, they need 40 gigawatts of annual energy storage production capacity, and for that quantity a new factory is in order. LG already has the technology and production materials to achieve Stellantis’ goals, and now the two companies have entered a memorandum of understanding tp create a joint venture for a factory in North America.
“Today’s announcement is further proof that we are deploying our aggressive electrification road map and are following through on the commitments we made during our EV Day event in July,” said Carlos Tavares, CEO of Stellantis. “With this, we have now determined the next ‘gigafactory’ coming to the Stellantis portfolio to help us achieve a total minimum of 260 gigawatt hours of capacity by 2030.”
“Establishing a joint venture with Stellantis will be a monumental milestone in our long-standing partnership,” said Jong-hyun Kim, President and CEO of LG Energy Solution. “LGES will position itself as a provider of battery solutions to our prospective customers in the region by utilizing our collective, unique technical skills and mass-producing capabilities.”
Building On an Established Relationship
Both companies also have a previous relationship. In 2014, Stellantis used LG batteries and control technology on the Chrysler Pacifica Hybrid. Forming this joint venture will further strengthen their relationship. It will also utilize their individual strengths to help each other realize Stellantis’ EV sales goal by 2030. They just need to find the right place, first.
Again, Stellantis and LG have set a target of Q1 2024 with groundbreaking in Q2 of 2022. However, the companies still need to find a location and go through all the regulatory approvals. If you happen to be a fan of EVs, you’re probably excited for this news. More battery production means cheaper prices for cells thanks to the economy of scale. That could potentially mean cheaper EVs on the horizon, too. If you’re not a fan, you’ll probably let us know by commenting on Facebook or Twitter.
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