GM says it will seek reimbursement from LG Chem for $1B Chevy Bolt recall losses
GM’s investigation into the problems with its batteries discovered battery cell defects like a torn anode tab and folded separator. The recall comes a week after a fire including a Volkswagen AG ID.3 EV with an LG Energy Solution battery. Previously this year Volkswagen, along with Tesla, started making relocate to shift from LG Chem’s brand of pouch-type lithium-ion battery cells and towards more prismatic-type cells, like those made by CATL and Samsung SDI.
For now, there’s still work to be done together. GM stated it will change malfunctioning battery modules with new modules in the Chevy Bolt EVs and EUVs, which it says represent the $1 billion in losses. This is on top of the $800 million GM currently is spending for the initial Bolt recall last November. Battery packs are the most costly components of the electrical automobile, typically costing about $186 per kWh, according to information from energy storage research firm Cairn ERA. GM pays about $169 per kWh, and the Bolt has a 66 kWh battery pack.
The recall leaves GM with no completely electrical automobiles for sale in North America, which indicates it can’t take on Tesla and other car manufacturers as EV sales are on the rise. The loss in sales, the security threats and the possibility of much better tech on the horizon might cause GM to take its organization somewhere else.
The recall comes a week after a fire involving a Volkswagen AG ID.3 EV with an LG Energy Solution battery. GM stated it will replace faulty battery modules with brand-new modules in the Chevy Bolt EVs and EUVs, which it states accounts for the $1 billion in losses. LG Chem and GM did not react to requests for comment, so it’s not clear whether the two strategy to move forward on strategies announced in April to construct a 2nd U.S. battery cell factory in Tennessee.
LG Chem and GM did not react to demands for remark, so it’s unclear whether the two strategy to move on strategies announced in April to develop a 2nd U.S. battery cell factory in Tennessee. The joint venture, dubbed Ultium Cells, would intend to produce more than 70 GWh of energy.
This isn’t the very first time LG Chem’s batteries have led to a recall from car manufacturers. Previously this year, Hyundai remembered 82,000 EVs due to a comparable battery fire threat at an approximated expense of about $851.9 million. Hyundai’s joint battery endeavor was with LG Energy Solution, the specific battery system of LG Chem, which is preparing for its going public in September, however experts say the IPO might be delayed due to the recall expense.
American automaker General Motors expanded its recall of Chevrolet Bolt electrical cars on Friday due to fire threats from battery manufacturing defects. The automaker stated it would look for reimbursement from LG Chem, its battery cell production partner, for what it expects to be $1 billion worth of losses.
Following the news of the recall, the third one GM has released for this lorry, LG Chem shares fell by 11% on Monday, and its stock cost lost $6 billion in market price. GM’s shares were down 1.27% at market close.