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LG Energy Solution is planning a $4.5 billion investment in the U.S. that it says would undercut the rival SK Battery’s rationale for saving its embattled Georgia plant.
SK has said that an International Trade Commission Ruling in February barring the imports of components and equipment needed for production would force the Commerce, Ga., plant to shut down, even with carveouts to fill short-term orders from Ford and Volkswagen.
SK is now in the thick of a lobbying effort to persuade President Joe Biden to overrule the ITC decision, arguing that a closure of the $2.6 billion facility — and a cancellation of its eventual $5 billion in planned investment — would hinder the president’s environmental goals, create an effective EV battery monopoly and increase China’s leverage in a strategic sector. That’s not to mention endangering 2,600 Georgia jobs.
The Korean company has also argued that rival LG does not have the capacity in the U.S. to meet the needs of the market today.
LG disagrees, but it also said March 11 it would expand battery production capacity by 70 Gwh in the U.S. and add 4,000 jobs in-house and another 6,000 for subcontractors through the new investment plan. The move would double the size of its $2.3 billion joint venture factory with General Motors in Ohio, which is set to be completed in 2022 with a capacity of 35 Gwh.
The company “aims to alleviate the industry concerns around battery supply sufficiency and accelerate the process of expanding its position in the U.S. so that its large scale project plans can be implemented as soon as possible,” according to an LG news release.
LG even went as far as to say in a letter to Georgia’s new U.S. Sen. Raphael Warnock that if an investor were to purchase a shuttered SK Battery plant, LG would work with them to produce batteries, according to a report by the Atlanta Journal-Constitution. SK told the AJC that this would be “patently impossible” to do based on how battery technology works.
Meanwhile, Georgia officials have continued to lobby Mr. Biden ahead of the president’s Friday visit to the state to overturn the ruling that SK says would effectively kill its plant.
Public Service Commissioner Tim Echols, a Republican, said the decision has far-reaching ramifications in an op-ed that emphasized many of SK’s talking points.
“The effects of this decision are not limited to Georgia. The ruling will set the country back years in its clean energy goals, worsening an electric vehicle battery shortage that threatens our ability to move the transportation sector away from fossil fuels and toward clean, renewable energy supplies,” Mr. Echols wrote.
He added that the closure would erase a burgeoning EV ecosystem in Georgia that SK’s arrival is helping create, depriving future workers of training that SK and its suppliers would provide.
Georgia Gov. Brian Kemp sent a letter to Mr. Biden March 12 underscoring many of the same points and noting that President Obama acted to squelch an ITC case during his first term.
“Decisive action to disapprove the ITC ruling in this case is similarly vital to prevent the ruling’s adverse impact on Georgia and the US economy, and to preserve our nation’s ability to compete in the global race for clean energy cars and trucks,” Mr. Kemp wrote. “Simply put: the livelihoods of thousands of Georgians are now in your hands. This critical opportunity requires us to work together for the good of my state and our country. Please know that I am available to assist in any way with your decision.”
LG has not named a location for its prospective plant, saying it will narrow its list down to two location candidates in the first half of this year.