GM to Spend Nearly $7B on EV, Battery Plants in Michigan

By DAVID EGGERT and TOM KRISHER Associated Press
LANSING, Mich. (AP) — General Motors is making the largest investment in company history in its home state of Michigan, announcing plans to spend nearly $7 billion to convert a factory to make electric pickup trucks and to build a new battery cell plant.

The moves, announced Tuesday in the state capital of Lansing, will create up to 4,000 jobs and keep another 1,000 already employed at an underutilized assembly plant north of Detroit.

The automaker plans to spend up to $4 billion converting and expanding its Orion Township assembly factory to make electric pickups and $1.5 billion to $2.5 billion building a third U.S. battery cell plant with a joint-venture partner in Lansing.

“Today we are taking the next step in our continuous work to establish GM’s EV leadership by making investments in our vertically integrated battery production in the U.S., and our North American EV production capacity,” Mary Barra, GM chair and CEO, said in a press release. “We are building on the positive consumer response and reservations for our recent EV launches and debuts, including GMC HUMMER EV, Cadillac LYRIQ, Chevrolet Equinox EV and Chevrolet Silverado EV. Our plan creates the broadest EV portfolio of any automaker and further solidifies our path toward U.S. EV leadership by mid-decade.”

The Orion and Ultium Cells Lansing investments announced today will support an increase in total full-size electric truck production capacity to 600,000 trucks when both Factory ZERO and Orion facilities are fully ramped, according to the release. In addition, the company is investing more than $510 million in its Lansing Delta Township Assembly and Lansing Grand River Assembly plants for near-term product enhancements, the company stated.

Site work at Orion will begin immediately, with investments driving facility and capacity expansion including new body and paint shops and new general assembly and battery pack assembly areas. Electric truck production, including the Chevrolet Silverado EV and electric GMC Sierra, will begin at Orion in 2024, according to the release, and production of the Chevrolet Bolt EV and EUV will continue during the plant’s conversion.

Orion Assembly will be the company’s third US assembly plant being transformed for production of Ultium-powered electric vehicles. Other plants include Factory ZERO in Detroit and Hamtramck, Michigan; Spring Hill Assembly in Spring Hill, Tennessee; CAMI in Ingersoll, Ontario and Ramos Arizpe Assembly in Mexico. By the end of 2025, GM will have more than 1 million units of electric vehicle capacity in North America to respond to growing electric vehicle demand, according to the release.

Site preparations for the new Ultium Cells battery cell plant in Lansing will begin this summer and battery cell production is schedule to begin in late 2024, according to the release. Ultium Cells Lansing will supply battery cells to Orion Assembly and other GM assembly plants.

This will be GM’s third Ultium Cells battery plant in the U.S., including plants being constructed in Tennessee and in Lordstown, Ohio.

“These important investments would not have been possible without the strong support from the Governor, the Michigan Legislature, Orion Township, the City of Lansing, Delta Township as well as our collaboration with the UAW and LG Energy Solution,” Barra said in the release. “These investments also create opportunities in Michigan for us to bring our employees along on our transition to an all-electric future.”

Michigan’s economic development board on Tuesday approved $824 million in incentives and assistance for Detroit-based GM. The package was unveiled and authorized by the Michigan Strategic Fund Board. It includes a $600 million grant to GM and Ultium Cells, the venture between the carmaker and LG Energy Solution, and a $158 million tax break for Ultium. The board also approved $66.1 million to help a local electric utility and township upgrade infrastructure at the battery factory site.

Both factories are scheduled to start producing in about two years, as GM rolls the dice on whether Americans will be willing to convert from internal combustion engines to battery power.

The announcement is a critical win for Michigan, which lost out on Ford Motor Co.’s $11 billion investment in three battery plants and a new vehicle assembly plant that went to Kentucky and Tennessee.

GM President Mark Reuss said it made sense for GM to locate the battery factory near its large manufacturing footprint in Michigan. The company’s ability to quickly convert existing factories such as Orion to build solely electric vehicles is a competitive advantage over companies that need to costly build brand new plants, he said.

“We’re going to take advantage of that from an assembly plant standpoint, and then we’re going to put the new cell plants in the proximity to supply that footprint,” Reuss said.

GM says it will build four battery cell factories in North America. The Lansing announcement is its third, but Reuss said more may be needed as the transition to electric vehicles continues. The location of the fourth plant has not been announced.

“We’ve said four for now, but the adoption rate is rapid,” Reuss said. The other battery plants are being built in Lordstown, Ohio, and Spring Hill, Tennessee.

In Michigan, officials realized the critical nature of winning the GM investment after Ford’s announcement last year.

“The shift to electrification is truly revolutionary, and investment decisions being made now will have positive or detrimental impacts on regions for decades to come. The important of securing this investment to both the local and broader state economy cannot be overstated,” state economic development officials wrote in a memo requesting the incentives. They are separate from locally approved incentives, including a special power rate for the battery plant and tax abatements.

GM and Ultium, they said, considered multiple states for the new battery factory.

GM CEO Mary Barra plans to announce the Michigan spending at a morning news conference near the Capitol with Gov. Gretchen Whitmer, state lawmakers and others.

The development came months after Michigan missed out on three Ford Motor Co. battery factories and an electric vehicle assembly plant that were placed in Kentucky and Tennessee. The governor and the Legislature recently set aside $1 billion to land major business projects, two-thirds of which is for the GM facilities.

GM has set a goal of selling only electric passenger vehicles by 2035.

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Krisher reported from Detroit.

Information from a GM announcement was added to this report.

Pictured: Ultium Cells, a joint venture of LG Energy Solution and General Motors, announced a $2.6 billion investment to build its third battery cell manufacturing plant in the United States. The facility will be located in Lansing, Michigan. The new battery cell plant is expected to create 1,700 new jobs when the facility is fully operational. The approximately 2.8 million-square-foot facility is scheduled to open in late 2024.

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