South Korean battery giant LG Energy Solution (LGES) is gearing up to launch production of Tesla’s 4680 battery cell in its home country by August 2024, Business Korea reports, citing industry sources.
LG to ramp up production at Ochang plant
LGES is reportedly pushing through with its plans to start producing Tesla’s 4680 battery cells at its Ochang Factory in South Korea by August 2024.
The move will make LGES the first-ever global battery company to mass produce the innovative cylindrical battery cell for electric vehicles.
“Tesla announced on June 8 that it has cumulatively produced 50 million 4680 batteries in Texas, which is production of about 120,000 cells a day, but the yield is still below 20%. Tesla will definitely rely on LG Energy Solution and Panasonic for batteries.”
LS Securities researcher Ahn Hee-soo
The Ochang factory is expected to hit an initial production output of 8 GWh for 4680 battery cells alone. This capacity is sufficient to support the production of up to 110,000 electric vehicles.
Apart from Tesla, LGES also plans to supply the 4680 battery cells it produces to other electric automakers.
LG’s Arizona plant to follow suit in future North American production
LGES plans to expand its 4680 battery cell production to North America at its new Arizona factory, enabling it to benefit from the federal tax credits under the Inflation Reduction Act in the United States.
In hindsight, the South Korean battery company had initially planned to produce 2170 battery cells at the new Arizona factory with an annual capacity of 27 GWh.
However, LGES seems to have changed its mind in late 2023. It announced that the new North American facility would serve as a primary hub for 4680 production in the region.
4680 battery expected to increase range and lower costs
The 4680 refers to the battery’s dimensions, which are 46mm diameter and 80mm height. It holds more active material within the cell than the 2170-format cell, potentially resulting in a 16% greater range for EVs using them.
In addition, traditional batteries employ tabs to connect electrodes, which adds unnecessary bulk. The 4680 eliminates these tabs to accommodate more active material and potentially increases energy density.
The 4680 battery cell’s tabless design and larger format are expected to simplify manufacturing, reducing production costs. Tesla claims a potential cost reduction of more than 50% compared to the 2170-format cell.
Tesla is currently producing its own 4680 cylindrical batteries at its Gigafactory. However, its production rate is reportedly low. Therefore, LGES will play a crucial role in Tesla’s 4680 battery cell push for its electric vehicles.
