It is not every day that Samsung and LG, the two arch rivals, follow the same strategy. But that is what is happening when it comes to battery production for EVs.
Samsung SDI, a South Korean battery major, has a JV with Stellantis to produce battery cells and modules for EVs. The Korean company is also looking to increase its battery production in the Americas. As it happens, its arch rival LG Energy Solution (LGES) is also pursuing a similar plan.
LG Energy has said it plans to invest around $1.48 billion to set up a joint venture with Stellantis NV "to establish the first large scale, domestic, electric vehicle battery manufacturing facility in Canada."
LGES is also working on to acquire a stake worth $542 million in ES America to respond to demand from EV startups in the United States.
LGES is considering building another factory in Arizona. LGES already has its own factory in Michigan and two battery joint ventures with General Motors in Ohio and Tennessee.
To produce lithium-ion battery
On the new JV, LGES will own 51% of the proposed venture, tentatively named 'LGES-STLA JV' and Stellantis will have 49%.
The new company will produce lithium-ion battery cells and modules to meet a significant portion of Stellantis’ vehicle production requirements in North America. Stellantis is the maker of Jeep, Fiat and Peugeot vehicles.
Plant construction activities in Windsor, Ontario, Canada are scheduled to begin later this year with production operations planned to launch in the first quarter of 2024. The plant is located at the centre of Canada's automotive cluster.
The two companies announced that their new venture will have an annual production capacity in excess of 45 gigawatt hours (GWh) and will create an estimated 2,500 new jobs in the area.
"Our joint venture with LG Energy Solution is yet another stepping stone to achieving our aggressive electrification roadmap in the region aimed at hitting 50% of battery electric vehicle sales in the US and Canada by the end of the decade," said Carlos Tavares, Stellantis CEO.
"Through this joint venture, LG Energy Solution will be able to position itself as a critical player in building green energy value chains in the region," said Youngsoo Kwon, CEO of LG Energy Solution.
Stellantis and LG's plans
As part of its 'Dare Forward 2030' strategic plan, Stellantis has already said it will have global annual battery electric vehicle sales of five million by 2030, reaching 100% of passenger car BEV sales mix in Europe and 50% passenger car and light-duty truck BEV sales mix in North America.
Stellantis has also increased planned battery capacity by 140 GWh to approximately 400 GWh, to be supported by five battery manufacturing plants together with additional supply contracts.
LGES, for its part, has now secured production capacity of over 200 GWh in North America annually, translating into production of 2.5 million high performance electric vehicles. The battery manufacturer has previously announced plans to invest approximately $4.6 billion dollars into battery facilities in North America.
