Global automaker Stellantis, headquartered in the Netherlands, and South Korea’s LG Energy Solution announced a preliminary agreement to establish an electric vehicle (EV) battery cell and module manufacturing joint venture in North America.

Stellantis said the memorandum of understanding (MoU) provided for a new battery plant to be built at a yet to be announced location in North America with an annual production capacity of 40 gigawatt hours (GWh). Construction was expected to start in the first quarter of 2022 with a production start scheduled for the first quarter of 2024.

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Stellantis, which comprises US brands Chrysler, Dodge, Jeep and Ram plus European brands Fiat, Lancia, Peugeot, Citroen, DS, Opel and Vauxhall, is targeting 40% of its US sales to be electrified by 2030 and had previously said it planned to invest EUR30bn in vehicle electrification and software development by 2025.

The new joint venture factory would supply Stellantis’ vehicle assembly plants across the US, Canada, and Mexico, for installation in next generation electric vehicles ranging from plug in hybrids to full battery electric vehicles.

Stellantis’ CEO Carlos Tavares said in a statement: “The announcement is further proof that we are deploying our aggressive electrification road map and are following through on the commitments we made during our EV Day event in July. With this, we have now determined the next ‘gigafactory’ coming to the Stellantis portfolio to help us achieve a total minimum of 260 gigawatt hours of capacity by 2030.”

LG Energy Solution president and CEO Jong-hyun Kim added: “Establishing a joint venture with Stellantis will be a monumental milestone in our long standing partnership, as we position ourselves as a provider of battery solutions to our prospective customers in the region by utilising our collective, unique technical skills and mass production capabilities.”