General Motors Co. and South Korea's Samsung SDI have finalized their joint venture to build an electric vehicle (EV) battery plant in New Carlisle, Indiana. Initially announced in June 2023, the $3.5 billion plant will now begin production in 2027, a year later than previously planned.
The delay, attributed to slower consumer adoption of EVs and the need to finalize contract details, is expected to be less than a year.
GM, Samsung Delay Indiana EV Battery Plant Opening
Despite this, construction on the 680-acre site is already underway. GM Vice President of Batteries Kurt Kelty recently revealed that the cost of the plant has increased from $3 billion to $3.5 billion. The facility will have an initial capacity of 27 gigawatt hours (GWh), with potential expansion up to 36 GWh.
GM and Samsung's plant will focus on manufacturing nickel-rich prismatic and cylindrical battery cells. GM currently collaborates with LG Energy Solution to produce pouch cells at two US plants. The Indiana plant is projected to create approximately 1,600 jobs, though this is 100 fewer than initially expected. It is situated about 20 minutes west of South Bend, near the Michigan border, according to Detroit Free Press.
The plant's delay reflects a broader trend of slowing EV sales in the US due to consumer concerns about range and charging infrastructure. Market leader Tesla Inc. has recently cut prices, prompting other companies to adjust their pricing strategies. According to Motorintelligence.com, U.S. EV sales rose 7% in the first half of the year, reaching 599,134 units and accounting for 7.6% of the new vehicle market. Federal tax credits and lease deals have bolstered these figures.
The New Carlisle plant will bolster Samsung's entry into the North American EV market and will also sell cells to other companies. This venture is GM's fourth collaboration on a battery cell factory, following partnerships with LG Energy Solution. Existing GM-LG plants in Ohio and Tennessee are already operational, and another plant is under construction in Lansing, Michigan.
According to WRTV, the decision to partner with Samsung comes after GM experienced recalls of Chevrolet Bolt EVs due to battery defects from LG that posed fire risks. The new plant's battery cells are expected to offer improved performance and cost-efficiency.
EV Market Faces Production Delays
The broader EV market has faced challenges, including delays in production. Ford, for instance, recently postponed the release of a highly anticipated electric pickup truck by 18 months and canceled a new electric SUV to focus on electric midsize pickups and gas-electric hybrids.
Despite these setbacks, the EV market has seen significant growth. The second quarter of 2024 witnessed an 11.3% increase in US EV sales compared to the same period last year, reaching a record 330,463 units, according to Kelley Blue Book. This growth is attributed to greater availability, discounts, and increased leasing options.
Kelty emphasized the importance of the Indiana plant in advancing GM's efforts to enhance EV performance and reduce costs. The plant will contribute to GM's strategy to meet growing demand and expand its EV offerings as the market evolves.
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