LG Chem Company, the chemicals unit of South Korean conglomerate LG Group, announced that it has signed an electric vehicle (EV) battery materials contract with a client located in the US, the company disclosed in a regulatory filing.
The deal for the supply of cathode materials is understood to be worth KRW 3.76 trillion (US$ 2.6 billion) and runs until the end of July 2029, making it one of LG Chem’s largest battery materials deals to-date. The company did not disclose the name of the client, citing a confidentiality agreement.
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While demand for battery electric vehicles (BEVs) in the US is expected to have fallen sharply since the Trump administration removed tax incentives under the Inflation Reduction Act at the end of September, sales of hybrid-electric vehicles have increased sharply this year – by an estimated 25% year-to-date.
LG Chem has been investing heavily in expanding its cathode materials production capacity, which currently stands at 150,000 tons per year split between South Korea, China and other locations. The company is investing US$ 1.4 billion to build a new facility in the US state of Tennessee with an annual cathode production capacity of 60,000 tons, which is scheduled to become operational next year. General Motors and Toyota are understood to be among the main customers for the new plant.
