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LG ELECTRONICS
LG Electronics has agreed to reimburse General Motors $1.9B due to defective battery modules installed in the Chevrolet Bolt. According to GM, the problem was a torn anode tab and folded separator in the battery cell, which increased the risk of a battery fire. GM recalled all its Chevy Bolts produced since the model's launch in 2016, about 142,000 vehicles.
GM noted the defective battery modules have caused at least 13 vehicle fires.
GM estimated the recall would cost it about $2B; it missed analysts' expectations for its Q2 2021 earnings due to setting aside ~$2B to replace the defective batteries in the vehicles.
GM’s VP of global purchasing and supply chain, Shilpan Amin, stated GM is working with LG to produce new battery modules and will start replacing the old batteries in the recalled Bolts this month.
GM shares climbed 1.6% before closing at $58.96, up 1.5% for the day following the reimbursement news.
More to the news,
In 2019 GM and LG announced a joint venture, Ultium Cells LLC, to build battery plants across the U.S.
They invested $2.3B to build a battery plant in Lordstown, Ohio. The plant is expected to open in early 2022.
Earlier this year, the companies invested an additional $2.3B in a second battery plant in Tennessee. The plant is expected to open in 2023.
GM plans to offer full EVs exclusively by 2035.
