LG Energy Solution announced it will invest approximately $5.5 billion to build a battery manufacturing complex in Queen Creek, Arizona. The investment is the largest single investment ever for a stand-alone battery manufacturing facility in North America. It is also more than four times the amount that LG Energy Solution initially announced last year to manufacture cylindrical EV batteries in the same location.
"Our decision to invest in Arizona demonstrates our strategic initiative to continue expanding our global production network, which is already the largest in the world, to further advance our innovative and top-quality products in scale and with speed," said Youngsoo Kwon, CEO of LG Energy Solution.
When completed the complex will consist of two manufacturing facilities - one for cylindrical batteries for electric vehicles (EV) and another for lithium iron phosphate (LFP) pouch-type batteries for energy storage systems (ESS).
With the new battery manufacturing complex in the southwestern state, LGES will boost its production capacity in major product segments, develop more cohesive partnerships with its customers in both EV and ESS sectors, and cut back on the logistics cost by bringing its new manufacturing facilities in close proximity to its customers.
The new manufacturing facility for LFP pouch-type batteries for ESS, which is the first ESS-exclusive battery production facility in the world, aims to start production in 2026. With LG Energy Solution Vertech, Inc.'s fully integrated energy storage solutions, LGES will further expand its presence in the entire ESS value chain.
The company's new manufacturing facilities will utilize a state-of-the-art smart factory system that carries out all decision making on machine-produced data. By implementing this key measure to enhance product quality, the Arizona facilities will aim to increase yield, improve manufacturing processes, and boost productivity to better respond to the ever-rising battery demands in the region.