LG Energy Solution agreement with Toyota for Battery Supply

Seoul, South Korea- LG Energy Solution Ltd., and Toyota Motor North America Inc., (Toyota) has announced that they have signed a supply agreement for lithium-ion battery modules to be used in Toyota battery electric vehicles (BEVs) that will be assembled in the United States. 

Starting in 2025, LG Energy Solution will supply vehicle battery modules with an annual capacity of 20GWh under the deal. LG Energy Solution's Michigan factory will produce the battery modules, which will be made up of high-nickel NCMA (nickel, cobalt, manganese, aluminium) pouch-type cells.

Toyota's increasing line of BEVs will benefit from the innovative power solutions as part of its multi-pathway product strategy, which includes a new BEV model that will be manufactured at Toyota Motor Manufacturing Kentucky in 2025. They will also support Toyota's vehicle electrification plans, as the company aims to provide 30 BEV models globally across its Toyota and Lexus brand nameplates by 2030, as well as generate up to 3.5 million BEVs yearly.

Mr. Tetsuo "Ted" Ogawa, president and CEO of Toyota Motor North America, said that, "Having secure supplies of lithium-ion batteries at scale with a long-term relationship to support Toyota's multi-pathway approach and growth plans for BEVs in North America is critical to achieve our manufacturing and carbon reduction plans." We are delighted to be working with LG Energy Solution to create products that will provide the performance and quality that our consumers expect."

LG Energy Solution will invest KRW 4 trillion (about USD 3 billion) in its Michigan site to construct new production lines for battery cells and modules specifically for Toyota, with completion scheduled for 2025. Initially, the battery modules will be shipped to Toyota Motor Manufacturing Kentucky, where they will be integrated into battery packs and installed on BEVs.

The agreement combines LG Energy Solution's proven capabilities in mass-producing high-quality battery cells and modules with Toyota's advanced battery pack technologies to create a product that uses LG Energy Solution's innovative power solution to optimise battery system performance, providing peace of mind and further enhancing the BEV customer experience. LG Energy Solution is continuing to improve battery safety, including heat management for its high-nickel NCMA batteries.

Mr. Youngsoo Kwon, CEO of LG Energy Solution, said that, We are thrilled to welcome Toyota, the world's best-selling manufacturer, as a new customer.  "With our 30 years of lithium-ion battery experience, we will provide innovative power solutions to support Toyota's push into battery electric vehicles. "The arrangement also provides us with another significant chance to enhance our manufacturing capacity in North America, resulting in additional real-world, large-scale progress towards electrification in the region."

The transaction is LG Energy Solution's largest single supply agreement secured outside of joint venture agreements. All of the world's top five automakers now use the company's batteries. Based on its market leadership, the business has eight battery manufacturing facilities in North America that are currently operational or under development, and it continues to expand both its production network and supply chain in the region