Published on February 21st, 2017 | by James Ayre0
LG Chem To Expand Battery Cell Manufacturing In US & China
February 21st, 2017 by James Ayre
The South Korean battery cell manufacturing firm LG Chem will be further expanding its manufacturing capacity in the US and China, despite the presence of some onerous regulatory hurdles in China, according to recent reports.
The expansion in the US will see the firm’s manufacturing facility in Holland, Michigan, grow in size and capacity — with the motive being to keep up with demand for the Chevy Bolt, Chevy Volt, and Chrysler Pacifica Hybrid, all of which use LG Chem batteries. (The Ford Focus Electric does as well, but demand is expected to be much lower than for the two aforementioned models.)
This expansion will reportedly begin next month and be completed by August.
The President of LG Chem, Nick Kassanos, commented (in an interview with WHTC News): “We’re associated with the 2017 Chevrolet Volt with sales breaking record numbers in December. Of course we also build the batteries and the pack for the Pacifica Chrysler Hybrid minivan that was named utility van of the year. The more you see with OEMs (original equipment manufacturers) with hybrid technology, LG Chem is available and willing to grow.”
As far as the expansion plans in China, LG Chem will reportedly be building two new plants to support its electric vehicle battery production efforts there (in Nanjing).
“It’s not yet known how much production capacity will the two additional plants add to the factory, but anything less than increasing from 50,000 to 100,000 EV batteries per year would be aiming low, since we’re talking about supplying batteries to the biggest electric car market in the world, China,” Push EVs provides notes. Indeed, China electric car sales have been tremendous, accounting for nearly as many sales as all other countries combined.
“The reason why I think that LG Chem isn’t announcing figures yet is because this way the company has more negotiating power with the Chinese government, which haven’t been very nice.”
Push EVs provides a bit more:
“It also seems that LG Chem finally convinced Carlos Ghosn, Nissan CEO to stop producing its own battery cells, so I wouldn’t be surprised if Nissan lets LG Chem to use Sunderland battery plant — as a part of a deal to get better kWh price than GM is getting with the Bolt EV. It’s a win-win situation, Nissan already has battery cell factories all over the world and LG Chem has the best technology.
“Ironically, in South Korea, its domestic market, LG Chem isn’t doing very well. Since Kia is using SK Innovation — another South Korean battery cell maker — as its supplier, all eyes are on Hyundai. However until Hyundai decides to boost IONIQ Electric production and its battery capacity to at least 40 kWh, most of the LG Chem battery cells produced in South Korea are going to be used in electric cars manufactured abroad.”
That last part is pretty interesting because, as noted a bit further above, LG Chem currently has some of the best electric vehicle battery technology out there. Politics always factors in, though, of course. Not that anything bad has surfaced about SK Innovation’s cells to date (which are used in the BMW i3 and will reportedly be used in Mercedes-Benz electric cars), but it is the case that LG Chem has definitely carved out more of a reputation for itself in recent years.