LG Chem, a South Korea-based chemical company, said recently that it plans to build a $3.2 billion electric vehicle (EV) battery manufacturing plant in Clarksville, Tenn.
The facility will be the largest of its kind in the United States and the biggest foreign investment in Tennessee's history. Expectations are that the EV plant will create 860 new jobs, according to a news release from the Tennessee Department of Economic and Community Development (TNECD).
Construction is slated to begin early in 2023 at the 420-acre Allensworth Farm on Charles Bell Road and International Park Road in northeast Montgomery County.
According to LG Chem, it chose the location "due to its proximity to key customers, ease of transporting raw materials, and active cooperation of the state and local governments."
The company noted that it envisions the site being "the supply chain hub where material and recycling partners work together to supply global customers."
LG Chem plans to begin production at the EV plant in the second half of 2025 and produce roughly 120,000 tons of cathode material annually by 2027. That is enough to power batteries in 1.2 million EVs with a range of 310 miles per charge. The plant, according to officials, will feature smart technology, allowing it to automate all production.
The new facility is the third EV battery factory announced for Clarksville in recent years.
Factory To Add to Dynamic Middle Tennessee Growth
The construction of the new LG Chem plant represents a continuation of growth in Middle Tennessee, according to the Tennessean, Nashville's major daily newspaper.
Montgomery County Mayor Wes Golden called the investment a significant development for the county, part of its bright future.
"Bringing LG Chem has been an intentional effort on the part of the state and local economic development councils to bring high quality employment to Montgomery County," he told the Tennessean. "An investment like this is a game-changer we do not take for granted."
Clarksville Mayor Joe Pitts applauded the latest jobs announcement in the greater Nashville region.
"[It] is more good news for our community," he told the Tennessean, "and further proves Clarksville-Montgomery County is on the right track in our economic development efforts."
Tennessee, and more specifically, Clarksville, will play a critical role in LG Chem's strategy to increase its battery materials business for next-generation EV batteries with improved capacity and stability. The production plant will have the ability to produce more than 10,000 tons of cathode material per line, a level of production state and company officials said will make it the industry's largest manufacturer.
"LG Chem's decision to invest $3.2 billion in Clarksville is a testament to Tennessee's unmatched business climate, skilled workforce and position as a leader in the automotive industry," Gov. Bill Lee said in a statement. "I thank this company for creating more than 850 new jobs to provide opportunity to Tennesseans across Montgomery County."
Tennessee a Major EV Producer
The Tennessean reported that LG Chem's planned factory will be constructed during a period of unprecedented investment in EV manufacturing in the state. Since 2017, companies have pledged to create more than 11,000 new jobs and invest $12.7 billion in Tennessee through EV projects. More than 180,000 EVs have come off the line in the Volunteer State since 2013, more than any other southeastern U.S. state.
"LG Chem's decision to locate its new cathode manufacturing facility in Clarksville underscores Tennessee's growing profile as a hub for U.S. and global companies," Stuart McWhorter, TNECD's commissioner, said in a news release. "As we continue our efforts to attract companies in the automotive industry, we are focused on supporting companies that boost Tennessee's presence in the EV space."
In general, the EV battery industry is growing rapidly as Americans are buying battery-powered cars at a record pace. According to data from Cox Automotive, EV sales jumped 70 percent in the first nine months of the year.
But the materials needed to produce EV batteries are hard to obtain.
According to the Natural Resouces Defense Council, 50 percent of global lithium and cobalt reserves are in Chile and the Democratic Republic of Congo, respectively. The processing of these minerals and subsequent manufacturing of EV battery cells also is concentrated outside of the United States.
With the demand for the critical minerals needed to produce EV batteries expected to grow sevenfold by 2030, the United States is working to stimulate its mineral production and recycling capacity — two factors that experts have said are key to transitioning to more electric car usage.
These efforts have been bolstered by incentives included in the federal Inflation Reduction Act and the earlier Infrastructure Investment and Jobs Act, which aim to resolve supply chain issues and address climate change by increasing the accessibility of EVs.
Among the provisions included in the legislation was $2.8 billion in funding for EV battery manufacturers. Grants were distributed to 12 recipients, including Microvast, another Clarksville-based EV manufacturer, in October. The company received $200 million to build a second facility in Clarksville.
What is LG Chem?
Founded in 1947, LG Chem employs nearly 19,000 people across 50 global business sites with more than $37 billion in sales, making it one of the largest chemical companies in the world.
South Korea is one of Tennessee's top 10 countries for foreign direct investment, with approximately 20 Korean-based establishments having invested $2.3 billion. In total, more than 3,500 people across the state are employed by South Korean companies.
"The new cathode manufacturing facility in Tennessee brings us one step closer to becoming the world's best battery materials manufacturer and fulfilling our corporate vision to become a top global science company," said Hak-Cheol Shin, CEO of LG Chem, in a news release. "This site will be the North American manufacturing center of excellence for the cathode supply chain and lead to the creation of many well-paying jobs contributing to the local economy in Clarksville."
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