South Korea’s LG Chem plans to start production at its US car battery factory in the second half of this year, two executives told Automotive News.
The Holland, Michigan manufacturing plant drew some unpleasant publicity in February, when a DOE investigation found that the production line at the plant was idle, but workers were being paid anyway. LG Chem received a $150-million federal grant, as well as a package of tax incentives, to build the plant, but so far, it has produced only a few test cells. The company has since reimbursed the government for its share of the dubious labor costs, and released an apologetic statement.
Now LG Chem says the facility will soon be turning out batteries for the Chevy Volt and Ford Focus Electric – the goal is to produce enough battery cells annually to equip 60,000 EVs.
“We will start preparations for the plant’s operation from the second half. It will soon commence operation,” said LG Chem CFO Cho Suk-jeh. Kim Jong-hyun, head of LG’s battery division, said that the company plans to start trial production in July or August.
However, demand is still lower than was envisioned when the plant was planned, and Cho Suk-jeh doesn’t expect the company to be profitable in the near term. “We don’t think we will be able to make profit on car battery business (this year). We are trying to minimize losses on car batteries,” he said.