Toyota secures battery supply to power new EVs in the US

Toyota has discovered a battery provider to energy its subsequent wave of electrical automobiles within the US. LG Power Answer and Toyota signed a long-term battery provide settlement Wednesday for upcoming EV fashions assembled within the US.

Beginning in 2025, LG Power Answer will provide Toyota with 20 GWh of battery modules yearly.

In keeping with the brand new supply agreement, the battery modules will probably be high-nickel NCMA (nickel, cobalt, manganese, aluminum) pouch-type cells.

LG Power Answer will make investments round $3 billion (KRW 4 trillion) into its Holland, Michigan, facility to construct unique EV battery manufacturing traces for Toyota to extend provide.

As soon as full, the battery modules will probably be despatched to Toyota Motor Manufacturing Kentucky, the automaker’s largest manufacturing plant globally. The battery modules will then be assembled into battery packs and used to energy new EVs within the US.

Toyota revealed in May it could produce its first EV assembled within the US, a three-row electrical SUV on the facility. It will likely be considered one of ten new Toyota EVs launching globally by 2026.

Though Toyota has but to disclose some other particulars on the brand new EV, it’s anticipated to reach in 2025, coinciding with the brand new provide settlement.

Ted Ogawa, president and CEO of Toyota Motor North America, mentioned the brand new provide settlement with LG is “essential” for its EV development plans within the US.

In the meantime, the provision deal is the one largest from LG Energy exterior of joint ventures. LG now provides batteries to the highest 5 international automakers. The corporate has eight manufacturing crops working or below building in North America because it continues increasing its battery provide chain.

Toyota, a infamous laggard within the EV period, has just lately stepped up its imaginative and prescient for the longer term. The automaker revealed plans to launch advanced EV batteries beginning in 2026 to energy EVs with practically 500 miles (800 km) of vary, quicker charging, and a decrease value.

Final month, the automaker confirmed off its next-gen EV production line, meant to considerably minimize prices and velocity up manufacturing.

Toyota will implement new expertise like Giga casting, self-propelled meeting traces, and extra in a bid to catch as much as Tesla and different EV leaders.

Electrek’s Take

With totally electrical automobiles accounting for lower than 0.40% of Toyota’s over 1.6 million car sales in North America by way of September, the automaker has a protracted solution to go in catching up.

Toyota bought 6,486 bZ4X fashions by way of the primary 9 months of 2023. Even Rivian, an EV startup, is well outpacing Toyota, with 15,304 EVs delivered within the third quarter alone. Rivian has delivered 36,150 automobiles in 2023 and is on tempo to provide 52,000 models.

Whereas many automakers are hitting double-digit EV gross sales and even 100%, Toyota’s account for much lower than 1%. Securing provide agreements for brand new electrical fashions is likely one of the first steps to get again on monitor, however 2025 should be too little too late.