As interest in electric vehicles continues to grow and the world moves away from gas-powered engines, demand for batteries has skyrocketed. In response, companies are working on new battery technologies to make them more efficient. They’re also spending massive amounts of money to build new manufacturing facilities.
General Motors (GM) and LG’s Chem division have been partnering to do so. Late last year, the duo announced plans to build a $2.3 billion electric vehicle battery plant in Ohio.
Now, GM and LG have announced that they are partnering to build a second U.S. battery plant that will also cost $2.3 billion. The second facility will be located in Spring Hill, Tennessee, about 30 miles south of Nashville. It will produce batteries for the Cadillac Lyric electric SUV, according to Reuters.
The cost of producing batteries for electric vehicles is high. In fact, it is the most expensive part of an electric car. That’s why companies like GM and LG are willing to invest so many billions of dollars in new production plants. Given the fact that electric vehicle sales are poised to skyrocket, the investment looks like a smart one.
The Spring Hill plant will make use of GM’s new Ultium battery architecture. It relies on a different chemistry than most batteries. Instead of only using nickel, cobalt, and magnesium, Ultium adds aluminum to the equation.
GM claims that batteries using its new Ultium architecture will have power ranging from 50 to 200 kWh. That scalability means they’ll be good for a wide variety of applications. Vehicles powered by Ultium batteries will reportedly have driving ranges of 400 miles or more.
The Cadillac Lyriq promises to be an exciting addition to the electric vehicle space. As an SUV, it will be poised to challenge the Tesla Model X. Environmentally conscious consumers that don’t want to sacrifice the size of their car may find that it is a viable option.
Moving forward, GM plans to start production of batteries for the Lyriq at its Spring Hill plant at some point next year. It’s unclear how long it will take to get the facility up and running, but it appears that GM and LG Chem plan to waste no time.
GM made a name for itself in the automotive world thanks to gas-powered cars. Now, as electric vehicles threaten to take over, it aims to stay on top of the North American vehicle market. It also plans to become carbon neutral by 2040.
To do so, GM needs to rapidly scale up its battery production capacity. Moves like the one it recently announced are crucial to doing so.
So far, GM has committed to spending $27 billion to develop and produce 30 new electric cars. It aims to meet that goal by 2025. That is certainly an aggressive timeline, but the automaker has a chance of meeting it thanks to its large investments.