South Korean LG Energy will invest some $3 billion in expanding the production capacity of a battery plant in Michigan after it inked a battery supply deal with Toyota.
Bloomberg reports that the deal is for 20 GWh of battery modules, to be supplied from 2025. Toyota will put these battery modules in its EVs that it will produce at its plant in Kentucky. This, Reuters notes, is enough to equip 250,000 EVs with batteries.
Toyota plans to have a lineup of 30 EV models across its brands by 2030, with an annual production capacity of 3.5 million vehicles.
Reuters recalls that LG Energy also supplies EV batteries to GM, Stellantis, Hyundai, and Honda. The South Korean company is currently building a $2.1-billion battery plant in Lansing, Michigan, specifically for the supply of batteries to GM.
Toyota, meanwhile, is also investing in battery manufacturing capacity. Earlier this year, it said it would invest $3.8 billion in a new battery plant in the United States that it was building in partnership with Panasonic. The initial investment in the facility was calculated at $1.29 billion.
There are some 37 battery plants built and planned in the United States, Reuters reports, with their combined capacity at 1.3 TW of annual production, per data from Benchmark Mineral Intelligence. This capacity is enough to supply more than 10 million electric vehicles with batteries annually.
Global EV sales in the first half of the year rose by an impressive 49% to 6.2 million units, according to data from Canalys. China remained the world’s biggest EV market, accounting for 55% of the global total, with Europe coming in second, with a 24% share of the global EV market. The United States came in third, accounting for 13% of the global EV market. For full 2023, Canalys expects EV sales to post a 39% annual increase to 14 million vehicles sold.
By Charles Kennedy for Oilprice.com
Charles is a writer for Oilprice.com