LGES to invest $450 mln in construction of mother factory for pilot battery production

By Kim Joo-heon Posted : April 25, 2023, 16:22 Updated : May 16, 2023, 11:17

[Courtesy of LG Energy Solution]

SEOUL -- LG Energy Solution, the battery-making wing of South Korea's LG Group, will build a mother factory that will become the main headquarters of its electric vehicle battery production plants scattered across the world. The factory will play the role of the battery maker's one-stop pilot production base for its EV batteries. A total of 600 billion won ($450.2 million) will be injected into the mother factory project. 
LG Energy Solution (LGES) said in a statement on April 25 that the battery maker aims to build the new plant by December 2024. The company said demands for various prototypes and production for batteries are rapidly increasing as the global EV market is growing in the North American market.

Conventional production lines operated by LGES have the ability to test-produce pilot items but they did not have the ability to evaluate whether the produced test products had the capability to be mass-produced. Test-produced EV batteries needed to go through additional verification processes to be assessed for mass production. 

According to LGES, the production line in Ochang about 90 kilometers (56 miles) south of Seoul would be used for pouch-type cells with more than 20 percent of improved energy density and mileage compared to existing products. Because pouch cells' exterior is not as hard as prismatic or cylindrical types, they can be made into different forms of batteries.

"We will secure more differentiated competitiveness through world-class QCD (quality, cost, delivery) for consumers by establishing the mother production line," an unnamed LGES official was quoted as saying.
LGES has strived to expand its partnership with battery material companies in North America including Electra and Avalon to build supply chains that meet the inflation reduction act (IRA) incentive conditions. The IRA, which was signed into law by President Joe Biden in August 2022, offers up to $7,500 in tax credits to EVs assembled in North America and contain more than a certain percentage of core minerals extracted in the region. 
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