HOLLAND, Mich. — LG Energy Solution and Toyota Motor North America, Inc. announced Wednesday they signed a supply agreement that includes a $3 billion investment into a West Michigan plant.
Under the contract, LGES will supply TMNA with lithium-ion batteries for electric vehicles produced in the United States.
FOX 17 reached out to the Michigan Economic Development Corporation, which confirmed the expansion announcement is in reference to the LGES plant in Holland, adding, "This is incredible news!"
Per the agreement, LGES will invest around $3 billion in its Holland facility to establish new production lines for battery cells and modules exclusive for Toyota.
The updates are expected to be completed in 2025.
“At Toyota, our goal is to reduce carbon emissions as much as possible, as fast as possible,” TMNA President and CEO Tetsuo “Ted” Ogawa said. “Having secure supplies of lithium-ion batteries at scale with a long-term relationship to support Toyota’s multi-pathway approach and growth plans for BEVs in North America is critical to achieve our manufacturing and carbon reduction plans. Working with LG Energy Solution, we are excited to be able to offer products that will provide the performance and quality our customers expect.”
“[Wednesday’s] announcement that LG Energy Solution and Toyota are partnering up to power electric vehicles in America right here in Michigan reaffirms our strategy to Make it in Michigan by building a landscape that encourages global investment while creating opportunities for people and communities across our state. Together, we can continue growing our economy, creating good-paying jobs and further cement Michigan as the global epicenter for the next revolution of the automotive industry,” Governor Gretchen Whitmer said in a statement to FOX 17.
Holland City Manager Keith Van Beek noted the planned investment at Wednesday's city council meeting.
"You all approved phase two, which is being built. This would be what I'm going to call phase three," he said. "Even though this has been announced, there might be kind of a perspective or a thought [that] this is a done deal...It's not."
Wednesday's announcement from LG and Toyota comes as the Holland plant near I-196 continues to undergo an expansion that began in 2022 after LG invested more than $1.7 billion to add one million square feet to the facility— that was expected to be done in 2024.
Beek said Wednesday that LG is looking for incentives from the city— specifically, a 50% tax forgiveness over the next 12 years.
"I always say it's nice to have 50% of something instead of 100% of nothing," Van Beek said.
LG announced its last expansion would bring 1,000 well-paying jobs to the city by 2025. Van Beek explained that, to his knowledge, Wednesday's investment would not require new employees.
"They use what's being called smart factory technology, where it's actually, actually utilizes [fewer] jobs," he said. "The number of jobs that they already have in place for phase one and that they committed to in phase two would be enough jobs to actually operate all three of the facilities."
The city of Holland did invest $10 million initially for a substation to handle the needed electricity for the plant.
Van Beek told FOX17, "Other than our standard practices that help pay for some extensions of utilities, the company and/or state will have to pay for the infrastructure needed to complete this proposed plant."
Right now, LGES supplies batteries to the world’s top five automakers— this contract with Toyota is the largest single supply contract LGES has signed.
READ MORE: LG battery plant expansion will create 1K new jobs in Holland
Toyota says it will roll out 30 battery EV models globally by 2030 under both its Toyota and Lexus brands.
