LG Chem remains mum on mystery customer

John Barnes
Special to The Detroit News
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Holland — The 184-pound gorilla in the room was not the thousands of next-generation electric battery cells that can move 3,500 pounds — the weight of a new Chevrolet Volt.

It was the mystery customer LG Chem Michigan has refused to name for which it recently added a fourth plant line at its Holland plant.

The Korean chemical company makes lithium ion batteries for plug-in hybrids like the Chevrolet Volt.

On Tuesday, company officials announced LG Corp. will partner with General Motors for the upcoming all-electric Chevrolet Bolt, sourcing everything from battery cells to instrument clusters to the infotainment system.

Executives from both companies toured the Holland plant Wednesday continuing to decline comment on whether the 2017 Bolt will be powered by a battery built in West Michigan.

But Bill Wallace, GM’s director of global battery system engineering , said the so called “unnamed customer” for the fourth battery line is “distinctly separate” from any Bolt discussion.

Jeremy Hagemeyer, the plant's human resources manager, said only that the customer is a major automaker, and that production would begin the first quarter of next year .

The Holland factory now employs 318 workers – well up from about 100 at the year’s start, with another 70t o 90 to be added, he said.

The recently announced relationship on the Bolt is helping the company become General Motors’ go-to supplier for advanced electric batteries and other technology. Development and manufacture of nearly a dozen LG Chem components for the Bolt were done at a cost of more than $250 million in South Korea.

Steve Zachar, formation manager at LG Chem, was confident the Holland plant can make Bolt batteries should it be asked too.

“We’re capable of making all kinds of products, but were not currently making that line,” Zachar said.

LG Chem produces lithium-ion battery cells for the Volt plug-in hybrid, Cadillac ELR and Chevrolet Spark EV and will produce them for the plug-in hybrid electric version of the Cadillac CT6 at its plant in Holland.

Production is accelerating at the plant, which has a stop-and-go history, mostly stop until this year.

The plant was awarded a $150 million federal grant in 2009 to build the 850,000-square-foot plant in Holland. The company ran into controversy, however, after it spent $143 million without producing a vehicle battery cell and employing fewer than half the 440 it had promised. The Department of Energy’s inspector general said U.S. LG Chem employees wasted more than $1.6 million in work time “playing games and watching movies.”

LG Chem Michigan also was awarded $175 million in state and local tax breaks through 2025.

Wednesday’s event was meant to showcase the lighter, stronger Gen 2 Volt battery.

If a plant floor could gleam, this one did; it was made of stainless steel. Visitors must wear hairnets, protected clothing and plant-provided shoes to enter the pristine “clean facility." The tour showcased how anode and cathode electrodes are made, laminated, folded into bi-cells, and ultimately stored for drying.

John Barnes is a freelance reporter in West Michigan

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