US EditionUS Government Confirms Tesla and LG Energy Solution's $4.3 Billion Battery Deal
Tesla's $4.3 billion contract with LG Energy Solution secures domestic LFP battery supply to avoid tariffs and support 31.4 GWh deployment growth in 2024, US officials said.
- The U.S. government confirmed Tesla is the customer behind LG Energy Solution's $4.3 billion LFP supply contract from August 2027–July 2030, with Lansing, Michigan factory cells powering Houston Megafactory's Megapack 3.
- Tariff pressure pushed Tesla to seek domestic supply as Chinese LFP cells now face tariffs as high as 82.4%, and Tesla's energy-storage division is supply-constrained, securing 50 GWh of production from LG.
- The Lansing plant, originally Ultium Cells 3, is being converted by LG to manufacture LFP cells with equipment ordered for mass production in 2H 2027, after GM sold its stake in May 2025.
- If LG meets its targets, Tesla will match domestic Megapack 3 production with American-made cells, and combined Korean battery suppliers commitments total over $6.4 billion.
- Uncertainty over the mid-2027 start persists as converting Lansing production to LFP prismatic cells is complex, positioning LG as the primary U.S. scaler ahead of Samsung SDI and SK On.
21 Articles
21 Articles
Tesla’s $4.3 Billion Not-so-Secret Is Officially Out
Last July, South Korea’s LG Energy Solution said it inked a $4.3 billion contract to supply batteries to … someone. The secret was as poorly kept as a college frat house, with reports immediately pointing to Tesla as the not-so-mysterious counterparty. Nearly eight months later, LG confirmed its deepened partnership with the Elon Musk-led automaker on Tuesday, after the Department of the Interior included the arrangement in a roundup of energy p…
US government confirms Tesla and LG Energy Solution's $4.3 billion battery deal
The U.S. government on Monday said electric vehicle maker Tesla and South Korea's LG Energy Solution had signed a supply agreement to build a $4.3 billion lithium iron phosphate (LFP) prismatic battery cell manufacturing facility in Lansing, Michigan, with an expected production launch in 2027.
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