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DETROIT – General Motors plans to spend $19 billion over roughly the subsequent decade through a brand new provider deal to source important materials to be used in electrical car batteries from LG Chem, the businesses mentioned Wednesday.
The long-term provider contract will see LG Chem provide GM with greater than 500,000 tons of cathode materials – embody nickel, cobalt, manganese, aluminum – from 2026 through 2035, the South Korean provider said in a release.
That provide can be sufficient to energy 5 million models of EVs with a spread of greater than 300 miles, it mentioned.
The cathode materials from an LG plant that is presently below development in Tennessee will provide GM’s three way partnership battery cell crops in North America, together with three joint venture plants with an LG spinoff referred to as Ultium Cells.
The partnership was initially announced in July 2022, however with out particulars round worth or manufacturing location. The unique settlement was slated to expire after 2030, however the newest iteration extends the deal one other 5 years.
EV adoption has been slower than anticipated, and automakers akin to GM have been slicing prices or delaying plans.
LG Chem mentioned it goals to “bolster cooperation with GM within the North American market” through the deal.
Jeff Morrison, GM vice chairman of world buying and provide chain, mentioned the “contract builds on GM’s dedication to create a robust, sustainable battery EV provide chain to help our fast-growing EV manufacturing wants.”
The contract is probably going one of many largest, if not the biggest, EV provide offers that GM has signed.
The deal suggests GM stays dedicated to EVs, however the longer contract implies the automaker is adjusting plans to account for slower adoption than beforehand anticipated.