- LG Energy Solution has inked a $4.3 billion deal to build batteries for Tesla’s grid-scale energy storage systems at its Lansing area plant
- It’s the latest in a series of changes to the Lansing plant and others across North America as companies shift from EV battery production to energy storage battery production
- The company has hired 408 of the 1,360 workers it promised Michigan in exchange for $120 million in state subsidies
The new Lansing-area plant originally built to supply EV batteries for General Motors will soon supply battery cells for massive Tesla batteries capable of storing power for utilities.
The new deal comes as flagging EV demand and surging energy demand prompt the owners to rethink business plans.
It’s the latest in a series of changes for a plant originally pitched as a joint venture between GM and LG Energy Solution to build batteries for GM vehicles with the help of $120 million in state subsidies.
But GM sold its stake in the $2.5 billion, 2.5 million-square-foot Delta Township facility in late 2024 amid a slowdown in EV sales and a vow by then-President-elect Donald Trump to end federal subsidies for the EV transition.
In the year-plus since, South Korea-based LG Energy Solution has partially pivoted to building lithium-iron-phosphate battery cells meant to store electricity to power homes and businesses at several of its North American facilities.
The plant is now producing no batteries for GM, a spokesperson for the automaker told Bridge Michigan on Tuesday.
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LG Energy Solution first detailed its $4.3 billion agreement to supply cells for Tesla’s energy storage systems to Reuters in July, and the US Department of Interior followed up this week with an announcement that falsely claimed the two companies would build a $4.3 billion facility in Lansing.
LG Energy spokesperson Phil Lienert told Bridge Michigan in a statement that the company will establish “dedicated production lines” at its existing Lansing area facility to produce the Tesla battery cells.
A Tesla spokesperson did not immediately respond to requests for comment from Bridge Michigan.
“Today’s announcement is proof that Michigan is, and will continue to be, the premier state in the nation for mobility and advanced energy solutions,” said Michigan Economic Development Corp. spokesperson Danielle Emerson. “We are proud of all parties involved for reaching this agreement, and grateful to our federal partners for recognizing the value of Michigan’s workforce and supply chain to reduce national dependence on foreign markets.”
The Trump administration’s celebration of the deal was part of a broader announcement featuring US companies’ partnerships in the Indo-Pacific. Also included among the $56 billion in featured investments was Holtec Energy’s previously announced deal with Mitsubishi Electric and Hyundai Engineering & Construction to build small modular nuclear reactors at the shuttered Palisades nuclear power plant site in southwest Michigan.
“Thanks to @POTUS’ strong leadership, the world is turning to reliable, affordable U.S. energy and investing in good-paying American jobs that will uplift communities across the country!” Energy Secretary Doug Burgum said in a Sunday social media post hailing the deals.
In response to the EV slowdown and surging demand for power to supply data centers and other energy-intensive developments, LG has shifted focus from EVs to battery energy storage systems at several of its North American facilities, including an Ontario NextEnergy plant and a joint-venture plant with General Motors in Tennessee.
The company also produces grid-scale battery cells at its Holland, Michigan factory.
Tesla officials, meanwhile, have been open about their desire to onshore a heavily China-dependent battery supply chain to avoid paying tariffs that the Trump administration has levied on goods imported from the country.
LG has reportedly been producing its own battery cells at the Lansing facility since May 2025. It is slated to start producing the Tesla cells in 2027.
To fulfill the terms of its state subsidy agreement, LG needs to hire 1,360 workers at the Delta Township site by 2031. So far, hiring stands at 408, according to an MEDC annual report published this month.
The company has said it expects to pay the site’s manufacturing workers about $55,000 per year.
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