General Motors (GM) has announced a $19 billion deal with LG Chem for the delivery of electric vehicle (EV) materials. This partnership between the South Korean chemical company and the American automaker is set to run from 2026 to 2035. According to the terms of this extensive agreement, LG Chem will supply GM with over 500,000 tons of necessary cathode materials, such as nickel, cobalt, manganese, and aluminum, needed for EV battery production. The deal will provide GM with enough materials to produce approximately 5 million EVs.
These materials will come from LG Chem’s facility in Tennessee, which is currently under construction and set to become the largest cathode plant in the United States. The location of the supply chain operations will enable GM to meet the criteria for subsidies under the Inflation Reduction Act (IRA) regarding tax incentives for EVs.
“This agreement builds on GM’s commitment to establish a strong and sustainable source of raw materials for battery production to support our growing EV production needs,” said Jeff Morrison, GM’s Vice President of Purchasing and Supply Chain.
This deal comes at a crucial moment for GM, which is seeking to gain a larger share in the EV market currently dominated by Tesla. Despite Tesla’s dominance, GM has made significant progress with its Chevrolet Bolt EV/EUV models, which were initially slated for discontinuation this year but have been refreshed and will return in 2025 as next-generation models.
These changes have been implemented as part of GM’s broader cost-saving strategy, which aims to streamline operations and allocate resources more efficiently. The company has also abandoned its previous plan to invest $5 billion in the development of entry-level EV models.
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FAQ:
1. Who are the parties involved in the agreement?
General Motors (GM) is an American automaker, and LG Chem is a South Korean chemical company.
2. What is the value of the agreement?
The agreement is worth $19 billion.
3. How long does the agreement last?
The agreement is set to run from 2026 to 2035.
4. What will LG Chem supply to GM?
LG Chem will supply GM with over 500,000 tons of necessary cathode materials, such as nickel, cobalt, manganese, and aluminum, needed for EV battery production.
5. Where will these materials come from?
The materials will come from LG Chem’s facility in Tennessee, which is currently under construction and set to become the largest cathode plant in the United States.
6. How many EVs will be produced using these materials?
The agreement will provide GM with enough materials to produce approximately 5 million EVs.
7. What are GM’s goals in relation to this agreement?
GM is aiming to gain a larger share in the EV market and establish a strong and sustainable source of raw materials for battery production.
8. What changes is GM making in its cost-saving strategy?
GM is streamlining operations and allocating resources more efficiently, while also abandoning its previous plan to invest $5 billion in the development of entry-level EV models.
Definitions:
1. GM – General Motors: an American automaker.
2. LG Chem – a South Korean chemical company.
Related Links:
– gm.com – Official website of General Motors
– lgchem.com – Official website of LG Chem.
The source of the article is from the blog jomfruland.net