Tesla and South Korea's LG Energy Solutions are launching a large-scale battery manufacturing project in the United States.
The companies have agreed to build a $4.3 billion lithium-iron-phosphate (LFP) prismatic battery cell plant in Lansing, Michigan. The plant is scheduled to begin production in 2027.
The battery cells, which will be manufactured in the United States, will reportedly be used in Tesla's Megapack 3 energy storage systems, which are manufactured in Houston.
LG Energy Solutions had previously announced a $4.3 billion deal with Tesla. Under the deal, the company will supply LFP batteries for three years. The name of the customer and the application for the batteries were not disclosed at the time.
The partnership is seen as part of Tesla's strategy to reduce its dependence on Chinese imports. The company is trying to increase production in the United States, especially in the face of tariffs.
It should be noted that LFP battery technology is largely dominated by Chinese manufacturers, and LG Energy Solution is one of the few companies in the United States that produces this type of battery.
