LG Energy Solution (LGES), a leading global manufacturer of lithium-ion batteries for electric vehicles, mobility, IT, and energy storage systems, announced it will invest a total of $5.5 billion to build a battery manufacturing complex in Queen Creek, Arizona. 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). The investment represents the largest single investment ever for a stand-alone battery manufacturing facility in North America.
“With this historic investment from LGES, Arizona has become the battery manufacturing capital of the country,” said Governor Katie Hobbs. “These Arizona-made batteries will power green, sustainable technologies around the world, cementing Arizona’s reputation as an innovation hub for renewable energy. We’re grateful to LGES for their legacy investment and for committing to making thousands of good-paying jobs for Arizonans.”
The $5.5 billion is nearly four times the initially-announced investment of $1.4 billion. The company plans to invest $3.2 billion to build a cylindrical battery manufacturing facility for EV with a capacity of 27 GWh. LGES also plans to invest $2.3 billion in a LFP pouch-type battery facility for ESS with a capacity of 16 GWh. Both facilities, totaling 43 GWh, are expected to break ground this year and lead to the creation of thousands of new jobs.
“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. “We believe it’s the right move at the right time in order to empower clean energy transition in the U.S.”
“Today’s announcement will not only support thousands of good-paying local jobs, but it will also boost Arizona’s position as a leader in manufacturing and renewable energy,” said Senator Mark Kelly. “Thanks to unprecedented federal investments in American-made clean energy manufacturing, Arizonans will see stronger supply chains, lower costs, and a more competitive economy for the generations to come.”
“We couldn’t be more excited that LGES has chosen to expand their initial investment four-fold with plans to construct another high-tech manufacturing facility,” said Sandra Watson, President and CEO, Arizona Commerce Authority. “We are immensely grateful to CEO Youngsoo Kwon and the entire team at LG Energy Solution for their continued commitment to Arizona. My thanks also to all our partners who played a special role in this project, especially Governor Hobbs, Pinal County, Town of Queen Creek, Senator Kelly, Arizona Chamber of Commerce and Industry, GPEC and SRP. This has been a tremendous team effort and we look forward to this transformational project breaking ground.”
The new cylindrical battery manufacturing facility aims to start mass production of 2170 cells in 2025, mainly for EV makers in North America. It is the first-ever U.S. cylindrical battery manufacturing facility solely invested by a Korean battery manufacturer.
“We are so excited that LGES is expanding this pivotal project that supports the demand for innovative clean energy solutions,” said Queen Creek Mayor Julia Wheatley. “The substantial investment will create a positive ripple effect for the region and the state, bringing local jobs, infrastructure, and capital investment. LG Energy Solution will be the first company to break ground along the advanced manufacturing corridor – we value their partnership and appreciate the coordination from the county and state.”
“One of our primary objectives as a Board of Supervisors is to bring investment and employment opportunities to Pinal County, so that our residents do not have to leave the County to find high-paying jobs,” said Mike Goodman, Pinal County Supervisor for District 2. “I am so pleased that we are accomplishing that with LGES. This type of development also brings additional resources to improve roadways and infrastructure for our community.”
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.
LGES’ expansion adds to a recent string of battery announcements in Arizona. In February, Ecobat announced plans to build a lithium-ion battery recycling facility in Casa Grande. In December, American Battery Factory announced it is investing $1.2 billion to build a lithium-ion battery manufacturing facility in Tucson, creating 1,000 jobs and Sion Power announced it is expanding its battery manufacturing operations in Tucson, creating over 150 jobs.