After 52 years of operations that produced more than 16 million vehicles, the General Motors (GM) assembly plant in Lordstown, Ohio, shut down in March 2019. As a result, some 1,500 workers lost their jobs. However, GM brought a new opportunity that would set Ohio up to play a key role in the future of electric vehicle (EV) production.
GM and Ohio have a history dating back to the mid-1900s. Over that time, GM has invested billions of dollars into the state, which is a leader in the North American automotive industry. Ohio has the second-largest automotive workforce in the U.S., and its geographic location makes it possible for automotive companies to reach 77% of North American automotive assembly production within a one-day drive.
Looking Toward an EV Future
In recent years, GM decided to restructure its business model to cut losses and focus on its most profitable operations, including furthering its investment in EVs.
Meanwhile, LG Chem, Korea’s largest diversified chemical company, was considering establishing a battery cell manufacturing plant in the southeastern region of the U.S. Their shared interest in the EV space brought the two companies together to consider forming a joint venture (JV) to mass-produce lithium-ion batteries for EVs.
As they evaluated where to establish this new EV battery manufacturing facility, the JV team reached out to Ohio to consider this exciting project.
Ohio Works Quickly
The joint venture aimed to begin site work in early 2020 to meet their aggressive production goals. Ohio only had a few months to work out the details to win the investment. JobsOhio’s unique, privately-funded economic development organization model made it possible for the organization to quickly present options and data, including cost analysis related to taxes and labor, as well as the overall cost of doing business in Ohio.
Challenges assembling the acreage required for the project sprung up quickly. Potential sites had issues with existing wetlands. Many entities worked with the JV team to resolve issues and identify a viable site.
The multi-billion dollar investment also required financial support from Ohio for the state to be considered for the project, as the cost of the investment by GM and LG Chem would be significant.
Welcome to Ohio, Ultium Cells
Finally, in December 2019, GM and LG Chem announced the creation of their 50/50 joint venture, known as Ultium Cells LLC, to mass produce batteries for future EVs in Lordstown, creating 1,000 jobs. Ultium Cells will be an integral part of GM’s ambitious plans to develop 20 EV models by 2023, and it represents an investment of up to $2.3 billion through the new, equally-owned JV. At the completion of the project, this facility will be one of the largest cell manufacturing plants in
As the world transitions from internal combustion engines to EVs, battery technology and production will be the new backbone of the automotive industry. This project marks the start of a new era in Lordstown, the Mahoning Valley, and Ohio. Locals in the Lordstown-Mahoning Valley region are beginning to describe it as the “Voltage Valley.”
The Ultium Cells investment will continue to strengthen the automotive industry in Ohio, enable economic resiliency and potential for the local and regional economy, and create a new EV-based cluster that reconfirms Ohio’s leading position in the new wave of a global automotive technology transition.