LG Energy Solution announced two new battery manufacturing investments in South Korea, related to 4680-type and 2170-type cylindrical cells.
According to Reuters, the company intends to invest a total of 730 billion KRW ($568 million) to expand its production capacity at the Ochang site.
This includes a 580 billion KRW ($450 million) investment to add 9 GWh/year production capacity of all-new 4680-type battery cells – most likely for Tesla, which is the first electric vehicle manufacturer to popularize this form factor. The new line/lines will be located at the No.2 Ochang factory.
Meanwhile, at the No.1 Ochang factory, the company will add 4 GWh/year worth of production capacity of already widely used 2170-type battery cells. This will cost 150 billion KRW ($116 million).
“Mass production” at the new lines is expected to be ready by the second half of 2023, which suggests that LG Energy Solution is at a similar stage as Panasonic, which aims to start series production at its Wakayama Factory in western Japan in the next fiscal year (between April 1, 2023 and March 31, 2024).
If we add the two investments, Tesla potentially might count for a stream of roughly 20 GWh of 4680-type batteries (rumored 10 GWh Panasonic and 9 GWh LG Energy Solution) in about 12-18 months. Depending on the average battery pack capacity, it would be 267,000 of 75 kWh packs, 200,000 100 kWh packs, and 100,000 200 kWh packs.
LG Energy Solution is currently investing a lot to expand its business around the world, including several new gigafactories in North America – joint ventures with General Motors (Ultium Cells), Stellantis, and potentially also with Honda. The company is investing 1.7 trillion KRW ($1.39 billion) to build a new cylindrical battery factory in Arizona and expand its plant in Michigan. Other investments are in Europe (Poland), Nanjing, China (including a partnership with Tesla for 2170-type cells) and Indonesia (with Hyundai).
LG Energy Solution new investments in brief:
- 2170-type battery cells
4 GWh/year production capacity
150 billion KRW ($116 million)
No.1 Ochang factory
- 4680-type battery cells
9 GWh/year production capacity
580 billion KRW ($450 million) investment
No.2 Ochang factory
- mass production “by the second half of 2023”