LG Chem has secured a landmark deal with General Motors (GM), entailing the supply of over 500,000 tons of cathode materials. The contract is valued at 25 trillion South Korean won (approx. 18.8 billion USD) and is set to run from 2026 to 2035, aimed to support the production of about 5 million electric vehicles (EVs). This agreement follows a comprehensive understanding made in July 2022 between the two entities for a long-term cathode material supply, underlining a deepening cooperation.
Jeff Morrison, GM’s Vice President, highlighted the contract’s role in strengthening the North American supply chain at a critical time for the industry, emphasizing the operation’s alignment with GM’s sustainable battery EV supply chain goals. LG Chem CEO, Shin Hak-cheol, expressed the company’s intent to lead the North American EV market towards sustainability and create unique customer value through world-class productivity and global production base expansions.
The contract involves the utilization of LG Chem’s Tennessee plant in the U.S. as a production hub for cathode materials, enhancing the local supply chain for North American EVs. Starting from 2026, LG Chem will supply GM with NCMA (nickel, cobalt, manganese, aluminum) cathode materials primarily for use in Ultium Cells, a joint venture between LG Energy Solution and GM, and potentially other EV projects.
The deal also aligns with the U.S. Inflation Reduction Act (IRA) subsidy criteria for EVs, using North American-sourced materials. December 2023 saw the commencement of LG Chem’s construction of America’s largest cathode plant in Tennessee, with a focus on optimizing production for North American EVs and achieving a high level of manufacturing competitiveness.
Source: LG Chem – Press Release
