On April 1, LG Energy Solution (LGES) has announced its intention to acquire full ownership of Ultium Cells LLC, a joint venture it currently operates with General Motors (GM). The move signals a strategic shift in LGES’s long-term ambition to strengthen its foothold in the U.S. electric vehicle (EV) battery market.
Ultium Cells was established in 2019 as a 50-50 joint venture between LGES and GM to produce battery cells for GM’s next-generation EVs. The partnership has built and is operating battery plants in Ohio and Tennessee, with a third facility under construction in Michigan. These plants collectively aim to provide over 130 GWh of annual production capacity once fully operational.
In a statement released on Monday, LGES said it is in “advanced discussions” to purchase GM’s 50% stake in Ultium Cells. While the exact valuation of the deal has not been disclosed, industry analysts estimate it could be worth several billion dollars, given the scale and strategic value of the joint venture.
Strategic Control and Supply Chain Security
The acquisition would allow LGES to gain full strategic control over the operations, management, and future expansion of Ultium Cells. As global competition intensifies in the EV battery space, full ownership would enable LGES to more flexibly respond to customer demands, optimize production, and make faster investment decisions.
“The full acquisition of Ultium Cells is aligned with our strategy to build a robust and independent battery manufacturing base in North America,” an LGES spokesperson said. “It will enhance our ability to supply to a broader range of OEMs beyond General Motors.”
The move also comes amid growing efforts by both the U.S. and South Korean governments to strengthen clean energy supply chains and reduce reliance on Chinese suppliers. LGES’s acquisition is expected to be favorably viewed by U.S. regulators, particularly if it results in expanded production capacity and job creation on U.S. soil.
GM’s Changing Battery Strategy
For GM, the potential divestment marks a shift in its battery strategy. The automaker has been increasingly exploring alternative cell suppliers and technologies, including its recent partnership announcements with startups and other major battery firms.
In response to the news, GM stated: “We remain committed to electrification and are evaluating the optimal mix of partnerships and internal capabilities to support our EV future. Discussions with LGES are ongoing and no final decision has been made.”
Market Impact
If completed, the deal would mark one of the largest battery-related acquisitions in recent years. Analysts see it as a bold move by LGES to solidify its leadership in the U.S., particularly as federal incentives like the Inflation Reduction Act (IRA) make domestic battery production more economically attractive.
“With full control of Ultium Cells, LGES can position itself as not just a supplier to GM, but a dominant player with the flexibility to serve multiple automakers,” said Jay Park, senior analyst at SNE Research.
As of now, both companies have not provided a timeline for the conclusion of the deal, but insiders suggest it could be finalized in the second half of 2025, pending regulatory approvals.