SEOUL — South Korean battery giant LG Energy Solution Ltd. said on Wednesday it plans to invest $1.5 billion to set up a joint venture with Stellantis in Canada.
LGES owns 51 percent of the joint venture, tentatively named “LGES-STLA JV” and Stellantis owns 49 percent, LGES said in a regulatory filing.
In October, LGES and Stellantis struck an EV battery production joint venture, targeting to start production by the first quarter of 2024 and aiming to have an annual production capacity of 40 gigawatt hours of batteries. LG hasn’t said where in Canada the joint venture will be located.
In a separate regulatory filing, LGES said it plans to acquire a stake worth $542 million in ES America to respond to demand from EV startups in the U.S.
LGES is considering building a factory in Arizona to meet demand in the U.S., two people familiar with the matter told Reuters, adding that the plant is expected to primarily produce cylindrical battery cells. LGES has its own factory in Michigan and two battery joint ventures with General Motors in Ohio and Tennessee.
“We are considering a new production site, but nothing has been decided yet,” said a spokesperson at LGES.
LGES, which counts Tesla Inc., GM and Volkswagen Group among its customers, currently has battery production sites in the U.S., China, Poland, Indonesia and South Korea.
Meanwhile Automotive Cells Company (ACC), a joint venture between Stellantis, Mercedes-Benz and TotalEnergies plans to build a battery plant in Italy, the latest move to boost capacity to meet demand for electric vehicles.
ACC will convert an existing Stellantis plant in Termoli, in southern Italy, into a battery facility as agreed in a March 21 memorandum of understanding with Italian authorities.
It has not provided details on the investment, but said on March 11 the goal was to produce batteries for more than 2.5 million vehicles per year by 2030. Read full story
The battery plant would be the third in Europe for Stellantis, after ones already announced in France and Germany, which are also being built through ACC.
Bloomberg contributed