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LG and Hyundai to invest $4.3 billion to build battery factory for electric vehicles

Korean companies LG and Hyundai are teaming up to set up a new electric vehicle battery cell manufacturing facility in the US. Giant companies will invest $4.3 billion in the project.

Korean companies LG and Hyundai are teaming up to set up a new electric vehicle battery cell manufacturing facility in the US. Giant companies will invest $4.3 billion in the project.

Each of the companies will own 50% of the joint venture, which will begin construction of the new facility in the second half of 2023. The new production facilities will be in Savannah, Georgia, where Hyundai also built its first factory. The battery factory is expected to be operational by 2025 at the earliest. After starting production at full capacity, it will be able to produce 30GHWh batteries every year. This number will be enough to support the production of 300,000 electric vehicles.

LG and Hyundai are among the latest companies to invest in US-based battery manufacturing facilities over the past few years. Toyota announced that it will build a battery factory in the country in 2021 as part of a $3.4 billion investment, while Ultium Cells (a joint venture of GM and LG) received a $2.5 billion loan from the Energy Department for the construction of its electric vehicle battery plants.

Ford announced that it has spent $3.5 billion to build a lithium iron phosphate battery factory in Michigan. It is known that the cost of lithium iron phosphate, which can tolerate more frequent and faster charging, is lower than other battery technologies. This technology is expected to reduce the cost of electric vehicles.

Seeing that the Biden administration is trying to bring more electric vehicle and battery production to the US, other companies seem to be able to do the same. Last year, it launched the American Battery Materials Initiative, which will award $2.8 billion in grants to 20 companies in hopes of encouraging manufacturers to begin battery production in the state and making sure that the United States will not be heavily dependent on “unreliable foreign supply chains.”

Hyundai and LG believe the new facility can help create a stable battery supply in the region and allow them to “respond quickly to growing electric vehicle demand in the US market.” Hyundai Mobis, the automaker’s parts and service division, will assemble the battery packs using factory-made cells. The automaker will then use these packages for Hyundai, Kia and Genesis electric vehicles.

Source: Egirisim / Prepared by Irem Yildiz

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