LG will invest $3 billion in its Michigan facility to produce batteries for Toyota beginning in 2025.
Under an agreement announced Oct. 4, LG Energy Solution will supply lithium-ion batteries to Toyota, to be used in its battery electric vehicles (BEVs) assembled in the U.S.
LG Energy Solution will supply battery modules at an annual capacity of 20GWh starting from 2025, to be manufactured in its Michigan facility.
The agreement will support Toyota’s expanding line of BEVs, including a new model that will be assembled at Toyota Motor Manufacturing Kentucky in 2025, and its goal to offer 30 BEV models globally and produce up to 3.5 million BEVs annually by 2030.
“At Toyota, our goal is to reduce carbon emissions as much as possible, as fast as possible,” said Tetsuo “Ted” Ogawa, president and CEO of Toyota Motor North America. “Having secure supplies of lithium-ion batteries at scale with a long-term relationship to support Toyota’s multi-pathway approach and growth plans for BEVs in North America is critical to achieve our manufacturing and carbon reduction plans. Working with LG Energy Solution, we are excited to be able to offer products that will provide the performance and quality our customers expect.”
To fulfill the supply agreement, LG Energy Solution will invest $3 billion in its Michigan facility to build new production lines exclusively for Toyota, with completion slated for 2025. Initially, the battery modules will go to Toyota Motor Manufacturing Kentucky to be assembled into battery packs and equipped onto BEVs.
“We’re excited to have Toyota, the best-selling global automaker, as our new customer. With our 30 years of experience in lithium-ion batteries, we will provide innovative power solutions to support Toyota’s push further into battery electric vehicles,” said Youngsoo Kwon, CEO of LG Energy Solution. “The agreement also presents another big opportunity for us to strengthen our production capacity in North America, thereby bringing more real-life, large-scale progress toward electrification in the region.”
LG Energy Solution now supplies batteries to all top five global automakers, with eight battery manufacturing facilities currently operating or under construction in North America.