South Korea’s LG Chem Company announced that Toyota Tsusho Corporation, a subsidiary of Japan’s leading vehicle manufacturer Toyota Motor Corporation, has acquired a 25% stake in its cathode active materials plant located in the South Korean city of Gumi.
LG Chem remains the largest shareholder in the plant, which is incorporated as LG-HY BCM Company, with a controlling 51% stake. Toyota Tsusho has become the second-largest shareholder after China’s Zhejiang Huayou Cobalt Company sold it a 25% stake, reducing its own holdings in the company from 49% to 24%.
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With the Chinese company downsizing its stake in LG-HY BCM Company to below 25%, the plant now meets the new Prohibited Foreign Entity (PFE) rules introduced by the US government in July 2025, allowing the plant to comply with the US IRA requirements and qualify for US tax credits.
Toyota Tsusho, described as a general trading company, plays a key role in Toyota Motor’s raw materials procurement. LG Chem confirmed that Toyota Tsusho plans to supply a portion of the cathode active materials produced at the plant mainly to battery manufacturing customers in North America.
The LG-HY BCM plant in Gumi is a key production hub for cathode materials, with a production capacity of 66,000 tons per year, using the LG Precursor Free (LGPF) process. LG Chem claims that the process, which eliminates precursors and directly sinters the materials from custom-designed metal feedstocks, has helped it become a leading producer in this segment.
LG Chem’s CEO, Shin Hak-cheol, said in a statement: “Toyota Tsusho’s equity participation marks a pivotal turning point as LG Chem strengthens its cathode supply competitiveness under the US IRA framework. We will further solidify our leadership in the battery materials market on the strength of world-class products and powerful global partnerships.”
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By GlobalDataLG Chem said it is currently expanding its global customer base and supply network, with new production facilities in Cheongju and Gumi in South Korea, Wuxi in China, and a new facility in the US state of Tennessee, scheduled to open in the second half of 2026.
LG Chem said it signed a KRW 25 trillion (US$ 18 billion) cathode materials deal with General Motors in 2024, enough for 5 million EV batteries, as well as major deals with Prime Planet Energy & Solutions (PPES), a joint venture between Toyota and Panasonic. In 2023, LG Chem signed a long-term cathode materials contract with Toyota Motor Engineering & Manufacturing North America (TEMA) worth KRW 2.9 trillion.
