LG Chem Signs 25 Trillion KRW Cathode Material Supply Contract with GM

Supply of 5 Million Electric Vehicles by 2035
Production of North American Cathode Materials at Tennessee Plant

LG Chem has signed a cathode material supply contract worth 25 trillion KRW with the American automobile company General Motors (GM).

On the 7th, LG Chem announced that it signed a cathode material supply contract with GM at the LG Twin Towers in Yeouido, Seoul. Under this contract, LG Chem will supply cathode materials worth at least 24.75 trillion KRW by 2035. The volume of cathode materials to be traded between the two companies is expected to exceed 500,000 tons. This amount is enough to produce batteries for approximately 5 million high-performance pure electric vehicles (EVs) capable of driving 500 km.

Aerial view of LG Chem's cathode material plant in Tennessee, USA (Photo by LG Chem)

The two companies reached a comprehensive agreement in July 2022 for long-term cathode material supply, and this supply contract strengthens their cooperation and specifies part of the agreed volume.

LG Chem will supply North American-made cathode materials to GM starting in 2026, when the Tennessee cathode material plant begins full operation. The NCMA (Nickel-Cobalt-Manganese-Aluminum) cathode materials produced at the Tennessee plant are expected to be mainly used by Ultium Cells, a joint venture between LG Energy Solution and GM.

Since the supply contract is directly with GM, LG Chem’s cathode materials may also be used in other GM electric vehicle projects. LG Chem plans to respond through local supply chains so that customers like GM can meet the electric vehicle subsidy criteria under the U.S. Inflation Reduction Act (IRA).

The Tennessee plant, which broke ground in December last year, is the largest cathode material plant in the U.S. with an annual production capacity of 60,000 tons. Located in the U.S. Midwest and East, it offers excellent geographical accessibility for customer deliveries and raw material imports, and by advancing the design technology of the calcination process, it aims to secure world-class manufacturing competitiveness with an annual production of 10,000 tons per line.

Jeff Morrison, GM’s Vice President of Global Purchasing and Supply Chain, said, "GM will build a strong and sustainable electric vehicle battery supply chain," adding, "At this important time of transformation in the automotive industry, we will strengthen the North American supply chain together with LG Chem."

Shin Hak-cheol, Vice Chairman of LG Chem, said, "We will lead the North American electric vehicle market by continuing strategic cooperation with GM, the number one automobile company in the U.S.," and added, "Through world-class productivity and expansion of global production bases, we will create differentiated customer value unique to LG Chem."

This content was produced with the assistance of AI translation services.