The Department of Energy of the United States is reviving an old loan program, and the first recipient of the program is the joint battery venture between LG Energy Solution and General Motors. The 2.5 billion dollars loan was issued to General Motors and LG Energy and will be used to provide help in financing the construction of new lithium-ion battery cell production facilities.
The loan provided to Ultium Cells, the name of the General Motors and LG Energy joint venture, is also expected to close in the upcoming months, and it will be used for the venture’s upcoming facilities in Tennessee, Ohio, and Michigan.
Both General Motors and LG Energy plans to invest over 7 billion dollars to jointly build three batteries intend together. Manufacturing at the Ohio factory is expected to start in August 2022; in Tennessee, production is scheduled for late 2023, and in Michigan, it is scheduled for 2024.
Ultium Cells said the new facilities will create 5,000 new high-technology jobs in the United States. The loan agreement requires Ultium Cells to offer employees fringe benefits, and a local prevailing wage.
The funds come from the Advanced Technology Vehicles Manufacturing (ATVM) loan program of the US government, which was tasked with issuing around 17.7 billion dollars in federal loans, and has not funded a new loan since 2010.
