The electric vehicle trend is growing at breakneck speed. More battery-powered cars are appearing on the streets every day as consumer demand continues to skyrocket. In response, carmakers have had trouble producing enough high-capacity batteries to keep up.
On Thursday, General Motors (GM) and LG Chem announced that they are partnering to create a $2.3 billion electric vehicle battery plant in Lordstown, Ohio. Construction of the midwestern plant will begin in 2020 with a completion target of 2023. Once finished, the plant will create over a thousand jobs in the area and claim the title of the world’s highest-volume battery plant.
Powerful Joint Venture
GM currently anticipates that its line of electric cars will debut in 2021. Meanwhile, there are currently 20 all-electric vehicles that will be available around the world by 2023. At the start, the new Ohio plant will focus on producing battery cells for GM’s line. However, the company states that it may be open to supplying batteries for other carmakers in the future.
The new plant will certainly have the ability to do so. It will boast a capacity of over 30 gigawatt-hours. The GM-LG creation will also be ready for future expansions. Last year, Tesla announced that its Gigafactory 1 has an annual rate of 20 gigawatt-hours. At the time, that made the battery plant the highest-volume one in the world. The GM-LG Chem collaboration will easily steal that honor.
GM’s CEO Mary Barra said, “The new facility will help us scale production and dramatically enhance EV profitability and affordability.”
The company’s stock hasn’t reacted much to the news. At the time of this writing, GM’s stock is down 0.18 percent on the day. Even so, investors are hopeful that the move will pay off in the long run once the company starts producing its own electric cars.
Boosting the Local Economy
Northeastern Ohio is ecstatic about the economic opportunity that comes with the new battery cell plant. After GM shut down its Lordstown factory nearly a year ago, thousands were left without jobs. That closing marked the first of four U.S. plants to see their doors shuttered as GM’s auto sales have declined.
The new battery plant will breathe a spark of life into the local Ohio economy as estimates suggest that it will bring 1,100 jobs along with it. GM has not determined if the new factory will be unionized. It will leave that decision up to future employees.
However, it did state that workers will have “very good paying jobs.” Considering the booming electric vehicle market, that isn’t a surprise.
LG Chem CEO Hak-Cheol Shin said optimistically about the plant, “The joint venture that we are signing today is more than just a collaboration. It marks the beginning of a great journey that will create an emission-free society and transform the global automotive market into an eco-friendly era.”