LG Energy Solution is officially starting its foray into the rapidly growing North American electric vehicle market in partnership with Toyota.
On the 5th, LG Energy Solution signed a large-scale long-term supply contract for electric vehicle batteries with Toyota automobile, amounting to an annual capacity of 20GWh.
This contract is the largest single order for LG Energy Solution excluding joint ventures. Modules equipped with high-nickel NCMA*-based pouch cells are expected to be supplied, and LG Energy Solution plans to invest a total of 4 trillion won in its Michigan plant in the U.S. from the end of this year to 2025 to establish production lines for battery cells and modules exclusively for Toyota.
The produced battery modules will be assembled into packs at Toyota’s Kentucky plant in the U.S. and will mainly be equipped in new Toyota electric vehicle models.
The two companies anticipate that combining LG Energy Solution’s cell and module technology with Toyota’s pack technology will produce batteries that are enhanced in all aspects, including safety and performance, enabling them to sell electric vehicles in which customers can drive with confidence.
LG Energy Solution boasts the world’s best technology and mass production capabilities in the field of battery cells and modules, with over 29,000 patents and an annual global production capacity of 200GWh. In fact, LG Energy Solution is achieving significant results, such as improving thermal management technology based on high-nickel NCMA for this collaboration.
Likewise, Toyota is showcasing high-level battery pack technology based on its self-developed platform and expertise from manufacturing over 10 million vehicles annually.
The two companies expect that their combined technological strengths will result in innovative batteries that provide new momentum for Toyota’s electric vehicles in the North American market transition.
Detzoo Ogawa, CEO of Toyota Motor North America, stated, “Toyota aims to reduce CO₂ as quickly as possible and aims to expand sales of electric vehicles in North America. Securing a stable supply of lithium-ion batteries from a long-term perspective is a crucial part of our manufacturing and product planning, and we are very pleased to collaborate with LG Energy Solution to provide products that meet customer expectations for high safety, performance, and quality.”
LG Energy Solution CEO Kwon Young-soo remarked, “This new collaboration between Toyota, the world’s number one automotive company, and LG Energy Solution, a leading battery company, will provide a significant advance in the North American electric vehicle market. Through this partnership, we will further strengthen our North American production network and enhance our competitive edge in innovative products to deliver unmatched customer value globally.”
This is the first time LG Energy Solution has entered into a battery supply partnership with Toyota.
Last year, Toyota achieved sales of 371 trillion won and ranked first in global automobile sales, demonstrating its traditional strength in the automotive industry. In North America, it ranks as the second in vehicle sales after GM, showcasing its significant influence.
Recently, it announced plans to launch 30 models by 2030 and to sell 3.5 million electric vehicles annually in global markets, accelerating its electrification strategy.
Meanwhile, with this contract, LG Energy Solution will supply batteries to all global top 5 automobile manufacturers (Toyota, Volkswagen, Renault-Nissan, Hyundai Motor, GM). This large-scale supply contract also provides another opportunity to secure an overwhelming competitive edge in the North American electric vehicle market.
Currently, LG Energy Solution operates and constructs two standalone factories and six joint ventures in North America, continuously expanding its customer portfolio and global production capacity. As of the end of June this year, LG Energy Solution’s cumulative order backlog stood at 440 trillion won.
Lee Sang-jin daedusj@autodiary.kr