The news also suggests that LG Energy is easing its push into North America, focusing instead on its home turf for now.

LG Energy will boost production of cylindrical batteries at a factory in Ochang. Tesla is the company’s principal buyer of these batteries, and the US electric car giant is believed to have requested greater output.

The investment also will support the development of smart factory technology, based on artificial intelligence, that LG Energy seeks to take to its factories overseas. The company plans to create 1,800 new jobs in South Korea through 2026.

With over US$200 billion in outstanding orders from automakers worldwide, LG Energy is racing to upgrade capacities in the US, South Korea, China and Poland to build a more stable supply chain.

LG Energy is expanding operations in the US, but the road has been rocky. The company in March announced plans for a cylindrical battery factory in Arizona, only to put them on hold indefinitely in July.

Surging labour and construction costs in the US along with the strong dollar may have prompted the company to switch focus back to South Korea. The battery maker also may want to see how the American program offering electric vehicle subsidies pans out.

LG Energy is building four factories in North America through joint ventures with General Motors, Honda Motor and Franco-Italian automaker Stellantis. These partnerships will reduce the financial burden on the world’s second-ranked automotive battery maker as it seeks to outspend and catch top player Contemporary Amperex Technology of China.

LG Energy is funding the latest projects in part with a US$2.5 billion loan its GM joint venture has secured from the US government and the 10.2 trillion won the South Korean company procured from its January 2022 initial public offering.