At a time when global supply chain problems frequently arise, "battery shortage" has become a risk that car companies cannot ignore. According to Reuters, General Motors and South Korean joint venture partner LG Energy Solutions recently stated that it plans to spend US$2.3 billion to build a second electric vehicle battery plant in Spring Hill, Tennessee.

The factory covers an area of ​​2.8 million square feet and is expected to employ 1,300 people by the end of 2023 to meet the growing demand of the electric vehicle market. The plant's capacity plan is to provide battery packs for more than 500,000 electric vehicles each year.

General Motors Chief Executive Mary Barra (Mary Barra) said that GM and LG Energy Solutions opened a second new Ultium battery factory in the United States of great significance, which is another major move in the transition to an all-electric future.

Jong Hyun Kim, president and chief executive officer of LG Energy Solutions, said that the new plant will enable the two companies to "establish a stable and stable American supply chain," making research, product development and production, and raw material procurement possible.

Sources previously told Reuters that General Motors and LG Energy Solutions will use a different battery chemistry from the Lordstown plant, which will be put into production next year, at a lower cost.

At present, most battery production is concentrated in Asia and Europe, and Tesla and Japanese partner Panasonic have largely controlled the supply of most batteries in the United States. After the opening of the new battery plant, it will provide battery packs for Cadillac Lyriq crossover electric vehicles. GM plans to produce this model at an assembly plant near Spring Hill next year. Prior to this, LG is expected to supply batteries from South Korea.

Supplier sources said that Cadillac’s second electric crossover, the Symboliq, is expected to be produced in Spring Hill together with Lyriq in 2024. At the same time, it will also produce two new electric crossovers for Honda and its high-end brand Acura.

According to the current plan, General Motors is expected to become a car manufacturer that only provides electric vehicles by 2035, so it needs to continue to build or renovate factories in the United States. General Motors announced earlier that it would invest US$27 billion to produce at least 30 new electric vehicles by 2025.

There may be a huge gap in battery supply in the future. Morgan Stanley analyst Adam Jonas warned that there may be a shortage of battery supply compared with the number of new electric vehicles that will be put on the market in the next few years.

It is worth noting that in late February, when risks in the global supply chain increased, Biden ordered a 100-day review of electric vehicle batteries, semiconductors, rare earth minerals and pharmaceuticals.