LG Chem announced a plan to build the largest EV battery cathode manufacturing facility in the US, which will be located in Clarksville, Tennessee.

The company just signed a memorandum of understanding (MOU) with the state of Tennessee and would like to start construction as early as the first quarter of 2023.

The whole investment is expected to cost more than $3 billion and will enable the South Korean manufacturer to produce 120,000 tons of cathode material annually by 2027, which is expected to be enough for 1.2 million electric cars per year.

Mass production will start in the second half of 2025, supporting lithium-ion battery cell production in North America by LG Energy Solution and its joint ventures (with GM, Stellantis and Honda).

According to LG Chem, the new factory will play a critical role in the company’s strategy to increase its battery materials business including cathode material fourfold from 5 trillion KRW in 2022 to 20 trillion KRW ($14.8 billion) by 2027.

The official press release indicates that a big factor to locate the plant in the US was the Inflation Reduction Act (IRA).

"For LG Chem, Tennessee was the best choice due to its proximity to key customers, ease of transporting raw materials and active cooperation of the state and local governments. The Tennessee facility allows LG Chem to proactively address the changing dynamics of the global battery material market and with legislation such as the Inflation Reduction Act (IRA). In addition to the benefits realized by investing in manufacturing on U.S. soil, LG Chem envisions the Tennessee site being the supply chain hub where material and recycling partners work together to supply global customers."

LG Chem to Establish Largest Cathode Plant in US (in Tennessee) for EV Batteries

One of the most interesting details is that the cathode chemistry envisioned for the new plant will be LG Chem's latest NCMA (also used in GM's Ultium Cells joint venture), containing nickel, cobalt, manganese and aluminum.

LG Chem explains that NCMA is envisioned for next-generation EVs thanks to improved battery capacity and stability.

Not only that, the plan will get LG Chem's most advanced production technology, including the ability to produce more than 10,000 tons of cathode material per line, which is considered the industry’s highest. It was applied for the very first time at the 4th production site Cheongju, South Korea.

LG Chem CEO Shin Hak-Cheol said:

“The new cathode manufacturing facility in Tennessee brings us one step closer to becoming the world’s best battery materials manufacturer and fulfilling our corporate vision to become a top global science company. This site will be the North American manufacturing center of excellence for the cathode supply chain and lead to the creation of many well-paying jobs, contributing to the local economy in Clarksville."

LG Chem to Establish Largest Cathode Plant in US (in Tennessee) for EV Batteries
LG Chem to Establish Largest Cathode Plant in US (in Tennessee) for EV Batteries

LG Chem cathode manufacturing facility in brief:

  • location: Clarksville, Tennessee
  • investment: more than $3 billion (about $3.2 billion Tennessee's press release)
  • area: 420 acres
  • cathode chemistry: NCMA
  • output target: 120,000 tons/year by 2027
    enough to power about 1.2 million battery-electric cars (assuming 100 kg per battery pack)
  • construction start (target): Q1 2023
  • mass production (target): H2 2025
  • new jobs: more than 850
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