Toyota Motor Corp has agreed to transfer a $1.5 billion battery order to LG Energy Solution’s Michigan facility, following General Motors Co’s decision to exit the project. This move aims to bolster operations at the plant located in Lansing, Michigan.
In December 2024, GM announced plans to sell its stake in the nearly completed Ultium Cells LLC battery cell plant to its joint venture partner, LG Energy Solution. The transaction is expected to close in the first quarter of 2025. GM stated that this decision would allow LG Energy Solution to “have immediate access to the nearly completed Lansing facility to begin the installation of equipment.”
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Following GM’s withdrawal, Toyota stepped in by shifting an existing order from another LG plant in Michigan to the Lansing facility. This reallocation is contingent upon LG’s full acquisition of the plant, anticipated to be finalized this spring. A Toyota spokesperson confirmed the agreement, stating, “This is part of our strategic objective to further optimize our investments in North America and also respond to the needs from global automakers.”
The Lansing plant was initially one of three battery facilities announced by GM in 2022 under the Ultium Cells joint venture with LG Energy Solution. However, GM’s decision to sell its stake reflects a strategic shift, as the automaker believes it has “the right cell and manufacturing capabilities in place to grow with the EV market in a capital efficient manner.”
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This development occurs amid broader industry adjustments, with several automakers reassessing their electric vehicle strategies in response to market dynamics and policy changes. LG Energy Solution plans to utilize the Lansing facility to meet demand from various automakers and other sectors, including battery storage solutions for data centers.
The plant is expected to commence production soon, aligning with LG Energy Solution’s strategy to enhance its North American operations and cater to the evolving needs of the automotive industry.