LG Energy Solution expands US ESS production with Tennessee LFP cell launch

Ultium Cells' battery plant in Spring Hill, Tenn. / Korea Times photo by Kwon Kyung-sung

LG Energy Solution (LGES) is expanding its energy storage system (ESS) production capacity in North America, as it moves to strengthen its supply chain and capture a larger share of the region’s rapidly growing market.

Ultium Cells, a joint venture between LGES and General Motors, began mass production of lithium iron phosphate (LFP) battery cells for ESS at its plant in Spring Hill, Tennessee on Tuesday (local time).

Commercial production at the Tennessee facility comes about four months after Ultium Cells announced plans to repurpose part of its electric vehicle (EV) battery production capacity into ESS manufacturing.

The joint venture invested approximately $70 million in the conversion, enabling the plant to begin large-scale production of LFP cells in the second quarter.

The batteries produced at the Tennessee plant will be supplied through LGES' U.S.-based ESS system integration subsidiary Vertech, serving utility-scale, commercial, industrial and residential energy storage projects across the country.

The move reflects the company’s strategic pivot toward the fast-growing ESS segment as EV demand growth moderates in North America. By leveraging existing manufacturing infrastructure, the company aims to boost factory efficiency while building a more flexible production system aligned with shifting demand.

The company expects the U.S.-made batteries to qualify for the country’s Inflation Reduction Act incentives, helping improve cost competitiveness.

The Tennessee expansion follows a series of recent investments in the company’s ESS business in North America.

It began large-scale ESS battery production at its facility in Holland, Michigan, last year, marking the first such operation in the region. Earlier this month, L-H Battery Company, its joint venture with Honda in Ohio, also started producing ESS battery cells.

LGES plans to begin ESS cell production at its facility in Lansing, Michigan later this year, targeting more than 50 gigawatt-hours of annual ESS manufacturing capacity across North America by the end of this year.