LG Chem has announced that it will triple production capacity for its cylindrical battery cells used by Tesla and other OEMs. The Korean company is also considering expansion in Europe and North America to meet the growing demand.
However, LG Chem did not specify a time frame for the planned production capacity tripling of cylindrical battery cells. On the verge of announcing its third-quarter results, in which LG Chem achieved record results due to the growing demand for electric cars and their batteries, the company stated: “Sales are expected to grow thanks to increased shipments of automotive batteries and cylindrical batteries for electric vehicles steadily.
In the third quarter, LG Chem achieved an operating profit of 902 billion won (equivalent to approximately 673 million euros). The Battery Division contributed 169 billion won (126 million Euro) to the operating profit, about twice as much as a year ago. The Batteries division also includes smaller batteries, which are used in smartphones, for example.
Among other things, LG Chem plans to build another plant in Europe. LG Chem already operates production facilities for electric car battery cells in Poland. Still, pouch cells (Audi e-tron, Ford Mustang Mach-E, Jaguar I-Pace, among others) are manufactured there. Where and from when a new plant for cylindrical cells will be built is not yet known.
The South Korean battery specialist also announced the development of cylindrical battery cells with a “new form factor”, whose energy density is to increase fivefold and power sixfold, without going into detail. Interestingly, this is similar to the targets Tesla announced for its new 4680 cells last month during ‘Battery Day‘.
While German car manufacturers mainly rely on the pouch or prismatic cells in their electric cars, Tesla works primarily with round cells – including those from LG Chem. While all Model 3 and Model Y cars built in the U.S. are equipped with Panasonic round cells from Gigafactory 1 in Nevada, Tesla is relying on other cell partners for Gigafatory 3 near Shanghai: The lower-priced LFP cells for the “Standard Range +” version of the Model 3 built in China come from CATL, while the long-range batteries are made of round cells from LG Chem – more precisely, from the Nanjing plant in China.
It has not been confirmed which car manufacturer LG Chem will supply with round cells from the new European plant. This could be Tesla in Grünheide, as the Californian company plans to use the 4680 cells there. Should LG Chem produce the cells developed by Tesla for the Giga Berlin, this would also explain the remark about the cylindrical battery cells with a “new form factor”.
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