GM and LG Chem recently announced a binding agreement to supply Cathode Active Material (CAM). The deal will help GM meet its increased EV production requirements. CAM is an important part of a battery made up of processed nickel, lithium and other materials that make up about 40% of the cost of a battery cell.
“This agreement builds on GM’s commitment to creating a strong, sustainable battery feedstock supply chain to support our rapidly growing EV manufacturing needs,” said Jeff Morrison, GM Vice President, Global Purchasing and Supply Chain. “LG Chem has demonstrated technical expertise, high performance and mass production capabilities of cathode active materials over the past decade. At the same time, this agreement demonstrates GM’s commitment to strong supplier relationships and complements our many other recent EV supply chain announcements.”
Under the terms of the agreement, LG Chem GM will supply more than 950,000 tons of CAM over an eight-year period. This amount is enough to support GM’s production of approximately 5 million EVs. The GM-secured CAM will be used by Ultium Cells LLC, a joint venture between GM and LG Energy Solutions, to support GM’s goal of 1 million EV production capacity in North America by the end of 2025.
“Importantly, GM has now entered into contractual arrangements with strategic partners for all battery feedstocks to support our goal of 1 million units of EV capacity by the end of 2025,” Morrison added.
In addition to the CAM supply agreement, GM and LG Chem will also explore the localization of CAM production in North America by the middle of the decade. This would bring jobs and investment to the region while reducing battery costs and increasing availability.
LG Chem plans to supply nickel, cobalt, manganese and aluminum NCMA (nickel, cobalt, manganese and aluminum) cathode materials for GM’s Ultium Platform electric vehicles. LG Chem’s best material technology is characterized by excellent stability and output. To improve stability while reducing the amount of cobalt used in batteries, a new high nickel material has also been developed, which will allow for significant improvements in the EV range.
In recent years, GM has been working to increase its EV production capacity and has taken steps to secure all battery raw materials needed to reach its goal of 1 million units of EV capacity in North America by the end of 2025. The agreement with LG Chem is another important step towards achieving this goal.
Shin Hak Cheol, CEO of LG Chem, said: “Based on a close collaboration with customers, LG Chem will further strengthen its position as a global leader in the market by producing the world’s finest cathode materials.”
As we have repeatedly reported on CleanTechnica, battery material supplies will be quite scarce in the coming years as more and more automakers switch to making electric vehicles and other industries embrace battery storage. In the ground there are no shortages of these materials, but the challenge is to extract them from the ground, refine them and process them into materials that can be used to make batteries.
This will require serious investment from the private and public sectors, but we can see GM taking this task seriously with yet another deal for battery materials.
Featured image by GM.
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