Company News

GM, LG Chem Select Site for Joint Venture Battery Plant

LORDSTOWN, Ohio — General Motors Co. and LG Chem of South Korea plan to build their $2.3 billion joint venture battery cell plant on 158 acres owned by NP Lordstown 173 LLC off Hallock Young Road and Tod Avenue here, the automaker announced Tuesday.

A purchase agreement has been signed, GM spokesman Dan Flores said Tuesday. A water quality certification permit application has been filed with the Ohio Environmental Protection Agency and the U.S. Army Corps of Engineers and discussions have begun with the village of Lordstown over potential incentives to help fund the $2.3 billion project.

The site is adjacent to GM’s former manufacturing complex, and is owned by an affiliate of NorthPoint Development of Kansas City. It was purchased by NorthPoint in 2011 from RACER Trust as part of the bankruptcy reorganization of General Motors Corp.

At the time, NorthPoint said it expected to develop the property into an industrial park that could employ as many as 1,500. Instead, in recent years the land was extensively logged, which created more than 40 acres of wetlands that GM and LG Chem must mitigate to the satisfaction of regulators before their joint venture can proceed.

“We’re still doing due diligence,” Flores says.

“We haven’t closed on the property but we’re moving forward on making this happen. This gets us a step closer to making this plant a reality and we’re excited about it.”

According to Flores, 66 acres at the site are categorized as wetlands. “Forty-one of those 66 acres of wetlands just emerged in recent years because of how the site was cleared and logged in 2015,” he says, disrupting drainage and leaving the land heavily rutted.

The size of the proposed manufacturing plant means the entire 158-acre property is needed to house the main plant, several support buildings, and a rail spur, parking lot, and storm-water management features, GM said. That will require replacement of the wetlands.

In its permit applications, General Motors and LG Chem propose a mitigation project that would restore 130 acres of wetlands in the Mosquito Creek Wildlife Area and within the Mahoning River watershed.

Drawing of wetlands mitigation plan proposed by GM and distributed to reporters.

“GM is committed to engaging with the community as we develop this project in a responsible and sustainable manner,” the automaker said.

The proposed plant site is due north of an adjacent 15 acres that Old Dominion Freight Line Inc., based in Thomasville, N.C., acquired Oct. 15 from NP Lordstown 173. Old Dominion paid $950,000 for that land, documents show.

Immediately south of Old Dominion’s newly acquired land is a 45-acre corner lot on the east side of the plant that fronts state Route 45. GM has an option to lease that land in conjunction with the $40 million mortgage it gave Lordstown Motors in December so that the startup electric truck manufacturer could buy its plant for $20 million. That lease-back option expires April 1.

The GM spokesman could not say whether the joint venture would reclaim those 45 acres.

GM and LG Chem announced the battery plant project Dec. 5 and said groundbreaking was expected to take place in mid-2020. Projected employment was estimated at 1,100.

“Multiple locations in the region were identified” as possible plant sites — virgin land and brownfields, GM said. Six were selected for consideration and then a “final two” were deemed most suitable.

In a fact sheet distributed Tuesday, GM said its “goal” is to begin initial site preparations this spring, “making way for installation of utilities, extension of rail and road access from adjacent infrastructure, and construction of buildings over the next several months.”

The battery cells produced there are intended to power GM’s electric vehicles. “Combining our manufacturing expertise with LG Chem’s leading battery-cell technology will help accelerate our pursuit of an all-electric future,” Mary Barra, CEO of GM, said Dec. 5.

Less than a week later, Lordstown Motors said it intends to build a battery-production line and an electric motor-manufacturing line inside the former GM Lordstown complex.

“We are building our own battery pack line inside the plant, and we’ll build electric motors inside the plant,” said Steve Burns, CEO of Lordstown Motors.

“We think it’s the prudent thing to do. It’s going to be a big thing.”

Pictured at top: Map of plant site distributed in GM fact sheet.

Copyright 2020 The Business Journal, Youngstown, Ohio.