SEOUL -- South Korea's LG Chem Ltd. said on Tuesday it will invest about $3.2 billion to build a battery cathode factory in Tennessee, as it ramps up plans to meet rising demand for U.S. electric vehicle components.
It's one of the first major EV-related investments announced by a South Korean firm in the U.S. since a new U.S. law was passed in August that puts automakers and battery suppliers relying heavily on China for sourcing at a cost disadvantage.
Mass production at the plant in Clarksville, Tenn., is set to start in the second half of 2025 and the plant will create more than 850 jobs, LG Chem said in a statement.
The plant is slated to have an annual production capacity of 120,000 tons of cathode materials by 2027, enough to power about 1.2 million EVs, it added.
LG Chem added that it is also pursuing cooperation with mining firms and recycling companies to better support its customers so that requirements of the new law, the Inflation Reduction Act, can be met.
LG Chem is expected to supply cathode materials to Ultium Cells, a battery joint venture between General Motors and LG Chem's subsidiary LG Energy Solution Ltd