GM to Sell Stake in Lansing Battery Plant to LG Energy Solution
General Motors (GM) has decided to sell its stake in the Ultium Cells battery plant in Lansing, Michigan, to its long-time partner LG Energy Solution. This move comes just as the plant, which has not yet opened, nears completion. GM made the announcement on Monday, signaling a shift in its approach to capital allocation. CEO Mary Barra had previously indicated that GM would focus on becoming more cautious with its investments and aligning production capacity more closely with actual demand.
The Lansing facility, part of the joint venture between GM and LG Energy Solution, was initially meant to be a key part of GM’s strategy to ramp up production of electric vehicle (EV) batteries. However, GM now believes that it can meet the demand for its growing EV lineup using the two existing battery plants it operates in Warren, Ohio, and Spring Hill, Tennessee. These plants already supply battery cells for a variety of GM’s electric vehicles, including the Chevrolet Silverado EV, Cadillac Lyriq, and GMC Hummer EV, among others.
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In its announcement, GM emphasized that the decision to sell its stake in the Lansing plant was also influenced by the company’s rapid improvement in EV profitability, which it credits to its strategic collaboration with LG Energy Solution. The decision comes at a time when GM’s EV manufacturing capabilities are advancing at a fast pace, allowing the company to operate with greater efficiency. GM’s CFO, Paul Jacobson, noted that with the two plants already in operation, GM is confident it can continue to grow its EV production while remaining capital-efficient.
Despite GM pulling back from its investment in the Lansing plant, the joint venture with LG Energy Solution remains intact. In fact, the two companies announced that they are extending their partnership to include new prismatic cell technology. This technology promises several advantages over the current pouch cells being produced at other Ultium Cells plants. Prismatic cells are designed to hold more energy, reduce the weight of electric vehicles, and cut manufacturing costs. These benefits are expected to play a significant role in GM’s ongoing push to optimize its battery technology and improve the performance, safety, and cost-effectiveness of its EVs.
While the plant in Lansing may no longer play a direct role in GM's future battery production, the decision to sell back the stake to LG Energy Solution is expected to benefit both companies. LG will take over the plant and repurpose its capacity for other customers, though the identity of those customers remains undisclosed. The plant’s nearly 100 employees are likely to remain in place, and LG has committed to maintaining the 1,700 jobs that were originally projected when the plant was first announced in 2022.
This shift in GM’s strategy, while significant, does not change the overall trajectory of its electric vehicle plans. With its existing battery plants and an extended partnership with LG Energy, GM is well-positioned to continue leading the charge in the EV market, with a diverse battery supply chain and a focus on maximizing production efficiency. The decision to sell the Lansing stake also aligns with GM’s broader goal of ensuring that it can meet the growing demand for electric vehicles without overextending itself financially.
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