Ultium Cells, the battery joint venture of General Motors and LG Energy Solution has been granted a $2.5 billion low-cost loan by the US Department of Energy.
Awarded by the government's Loan Programs Office (LPO) under the Advanced Technology Vehicles Manufacturing (ATVM) program, the loan will help the JV pay for three new lithium-ion battery cell manufacturing facilities in the United States. The US Department of Energy said on Monday it had finalized the loan.
Ultium Cells will use the money to finance construction of new lithium-ion manufacturing facilities in Ohio, Tennessee and Michigan. These plants will support 11,000 jobs—6,000 in construction jobs and 5,100 in operations, the DoE said.
The jobs include more than 700 United Auto Worker jobs in the newly-organized Warren, Ohio facility. Last week, workers at the $2.3 billion Ultium plant in Ohio voted to join the UAW as the union is seeking to organize the growing EV supply chain.
Gallery: Ultium Cells LLC Battery Plant in Spring Hill, Tennessee
Besides the three plants included in the loan, General Motors and LG Energy Solution are considering an Indiana site for a fourth US battery factory. The Ohio facility already started production in September, while the $2.6 billion plant in Michigan is expected to open in 2024. Earlier this month, Ultium Cells said it would increase investment in the $2.3 billion Tennessee plant by another $275 million.
The Ultium Cells battery factories will help General Motors meet its target to build 1 million electric vehicles in North America by 2025 and to go all-electric by 2035. The DoE said the loan closing will directly support US President Joe Biden's goals to reach net zero emissions by 2050 and have 50 percent of US auto production by 2030 made up of electric or plug-in hybrid vehicles.
"DOE is flooring the accelerator to build the electric vehicle supply chain here at home—and that starts with domestic battery manufacturing led by American workers and the unions that support them. This loan will jumpstart the domestic battery cell production needed to reduce our reliance on other countries to meet increased demand and support President Biden's goals of widespread EV adoption and cutting carbon pollution produced by gas-powered vehicles."
U.S. Secretary of Energy Jennifer M. Granholm
The announcement marks LPO's first closed loan exclusively for a battery cell manufacturing project under the Advanced Technology Vehicles Manufacturing (ATVM) program. In July, the ATVM loan program closed on a $102.1 million loan to Syrah Technologies for expansion of a facility producing a key component for batteries—the first new loan finalized from the ATVM program since 2011.