Stellantis and LG Energy Solution announced that they have entered into a partnership to form a joint venture to produce battery cells and modules for North America. The joint venture would establish a new manufacturing facility on US soil to help Stellantis’ goal of realizing more than 40% of its sales in the US comprised of electrified vehicles by 2030.
Firstly, the facility’s site is still under review, and further details of the factory will come later. However, the companies did reveal that the factory might start production by the first quarter of 2024. The plan is to have an annual capacity of 40 gigawatt-hours.
Moreover, Stellantis will provide the parts for the batteries. It would do so from its assembly plants throughout the US, Canada, and Mexico to install in next-generation electric vehicles. Models to use the batteries would range from plug-in hybrids to full battery-electric vehicles. Those will enter the market under Stellantis’ brands.
On the other hand, this is not the first partnership between the companies. In 2014 LG Energy Solution provided Stellantis with the lithium-ion battery pack system and controls for the Chrysler Pacifica Hybrid, the industry’s first electrified minivan. Since then, the companies are up to solidify their partnership even further and continue leveraging each other’s strengths.
Consequently, Stellantis plans to invest more than €30 billion through 2025 in electrification and software development; while targeting to continue to be 30 percent more efficient than the industry; concerning total Capex and R&D spend versus revenues.
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Stellantis and LG Energy to lead the battery market in the US
About such matter, Carlos Tavares, CEO of Stellantis, said. “With this, we have now determined the next ‘gigafactory’ coming to the Stellantis portfolio to help us achieve a total minimum of 260 gigawatt-hours of capacity by 2030.”
He also remarked that, together with LG Energy Solutions, “we will lead the industry with benchmark efficiencies and deliver electrified vehicles that ignite passion.”
On the other hand, Jong-hyun Kim, President, and CEO of LG Energy Solution, stated. “Establishing a joint venture with Stellantis will be a monumental milestone in our long-standing partnership.”
The executive further remarked on the benefits of the partnership. “LGES will position itself as a provider of battery solutions to our prospective customers in the region by utilizing our collective, unique technical skills and mass-producing capabilities.”
Finally, as outlined above, the transaction is subject to agreement on definitive documentation and customary closing conditions, including regulatory approvals. Companies expect to break ground on the project around 2022.
