(Bloomberg) —
LG Chem Ltd. agreed to provide 24.7 trillion won ($18.6 billion) of cathode materials to General Motors Co. under a long-term supply deal the companies inked Wednesday.
The agreement will see LG provide more than 500,000 tons of cathode materials to the US carmaker from 2026. The materials will be produced from LG’s plant in Tennessee and GM should be able to make around 5 million electric cars using them, according to a statement from the South Korean company.
The cathode arrangement is part of a longer-term supply commitment between the two firms, with the Korean chemicals giant pledging to provide the Detroit-based company with some 950,000 tons of cathodes through the end of the decade. The pact was signed during GM Chief Executive Officer Mary Barra’s visit to Seoul this week, where it was reported that she’s also meeting with Korean battery maker Samsung SDI Co.
LG completed construction of its Tennessee plant in December. The facility has an annual production capacity of about 60,000 tons, making it the biggest such plant in the US. Most of the supplies it produces will be used by Ultium Cells LLC, the joint venture between LG and GM, according to the statement.
LG Chem shares closed up 0.2% in Seoul, trimming declines for the year to 7.1%.
© 2024 Bloomberg L.P.
