GM to Sell Stake in Lansing Battery Plant to LG Energy Solution

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GM to Sell Stake in Lansing Battery Plant to LG Energy Solution

General Motors announced on Monday that it will sell its stake in the joint venture battery plant in Lansing, Michigan, to its partner LG Energy Solution. The automaker is adjusting its electric vehicle (EV) strategy and expects to recoup its approximately $1 billion investment in the facility.

The transaction is expected to be completed in early next year and will not affect General Motors' stake in the Ultium Cells joint venture, which includes battery plants in Ohio and Tennessee. The Lansing facility, nearing completion, will serve a new customer whose name has yet to be disclosed. The plant currently employs about 100 people and is on track to fulfill its employment commitments.

GM’s Chief Financial Officer Paul Jacobson commented on the company’s strategy, stating, "We believe we have the right cell and production capacity to grow capital-efficiently alongside the EV market.”

This development comes amid uncertainties regarding the future of EV battery production and consumer tax incentives. There are reports that the incoming administration may seek to eliminate the $7,500 consumer tax credit for electric vehicle purchases.

General Motors has been reviewing its EV production plans over the past year. In June, the company lowered its production forecast for EVs for 2024. In July, CEO Mary Barra indicated that due to slower market development, GM would not meet its goal of producing 1 million EVs in North America by the end of 2025; however, she expressed confidence in eventually reaching that target.

Additionally, this year, General Motors announced it was delaying the production of electric pickup trucks at a plant in Michigan by one year.

In a related move, GM and LG Energy Solution will expand their 14-year battery technology partnership to include the development of prismatic cells. Furthermore, GM signed a deal in August with Samsung SDI to produce prismatic cells at a battery factory in Indiana, which could potentially reduce the cost and weight of EVs.