GM EV and Battery Investment in Michigan

General Motors and LG have joined forces and invested $7 billion to build 600,000 electric trucks at a new facility in Orion Township, Michigan, and convert a factory in Lansing, Michigan, to produce electric vehicle (EV) batteries. Together, the factories will retain 5,000 well-paying jobs, and, over the next 20 years, they will create more than $28.8 billion in new personal income.

Historical context

Michigan is continuing to lead the automotive industry forward:

• The Ford Highland Park Plant in Detroit was the birthplace of the moving assembly line and launched Michigan to the forefront of the automotive industry. Ford and General Motors are both among the largest automotive manufacturing companies founded in the state. – Detroit Historical Society, last accessed May 2023; Detroit Historical Society, last accessed May 2023
• Michigan accounts for one-third of U.S. battery production and ranks sixth nationally for EV battery manufacturing employment. – Michigan Economic Development Corp., January 25, 2022
• General Motors idled facilities in 2022 due to the global semiconductor chip shortage. The Lansing area was hit hard by this decision due to the prevalence of autoworker and supply chain jobs in the area. – Detroit Free Press, January 25, 2022

Michigan recently created a $1 billion economic development package:

• Gretchen Whitmer (D-MI) and state lawmakers recently enacted a new $1 billion fund to land big investments and major business projects in response to losing out on $11.4 billion from Ford Motor Co. projects, including three battery factories and a Ford EV assembly plant. – DBusiness, December 15, 2021

Project summary

• “GM said Tuesday it will spend $2.6 billion to build a new battery factory in the Lansing area and $4 billion to convert its existing factory in Orion Township to make electric pickups. It will also spend about half a billion dollars to make upgrades to its two existing vehicle assembly plants in Lansing.” – Detroit Free Press, January 24, 2022

The new Orion Assembly facility will be dedicated to the production of Chevrolet Silverado EVs and electric GMC Sierras:

• “GM is investing $4 billion to convert the facility to produce electric trucks using the GM-developed Ultium Platform, which gives the company the flexibility to build vehicles for every customer and segment.” – General Motors, January 25, 2022
• “Orion Assembly will become GM’s third U.S. assembly plant being transformed for production of Ultium-powered EVs.” – General Motors, January 25, 2022
• “The company will construct several additions to the facility, renovate certain areas and make site improvements over the next three to five years, along with adding machinery, equipment, and special tooling.” – State of Michigan Office of the Governor, January 25, 2022

The grant will support a new Ultium Cells battery cell plant in Lansing:

• “GM and LG Energy Solution, via their Ultium Cells joint venture, are investing $2.6 billion to build Ultium Cells’ third U.S. battery cell manufacturing plant.” – General Motors, January 25, 2022
• “The facility will include a clean room environment, machinery, and equipment that will allow for the high-volume output necessary to produce cells at this capacity.” – State of Michigan Office of the Governor, January 25, 2022

General Motors is investing in the Lansing Delta Township Assembly and the Lansing Grand River Assembly:

• In addition to the EV-related investments in Michigan, General Motors is investing more than $510 million in its two Lansing-area vehicle assembly plants to upgrade their production capabilities for near-term products. Investment in the Lansing Delta Township Assembly supports the production of the next-generation Chevrolet Traverse and Buick Enclave. Investment in the Lansing Grand River Assembly supports plant upgrades. – General Motors, January 25, 2022

Outcomes, improvements, and practical impact

• “The Orion and Ultium Cells Lansing investments announced today will support an increase in total full-size electric truck production capacity to 600,000 trucks when both Factory ZERO and Orion facilities are fully ramped.” – General Motors, January 25, 2022
• “The company said that by the end of 2025, it planned to have a total annual manufacturing capacity of one million electric vehicles.” – The New York Times, January 25, 2022
• The Lansing battery plant is expected to have a capacity of 50 gigawatt-hours’ worth of cells annually, which is a significant increase over General Motors’ other plants in Ohio and Tennessee. This amount could support 400,000 to 500,000 vehicles annually. – Forbes, January 25, 2022

Climate impact

This plant will help fulfill General Motors’ aims to transition to an all-electric future:

• General Motors has announced investments in EV and autonomous vehicle (AV) development of more than $35 billion from 2020 through 2025. The company should be positioned to have “EVs represent 40% to 50% of annual U.S. sales volume by 2030” and aims to work with federal, state, and local governments on “implementation of supportive policies to move the United States closer to carbon neutrality consistent with the goals of the Paris Agreement.” – General Motors, last accessed April 2023
• “One of the Big Three automakers that dominated the North American car market for decades, GM has rolled out millions of pollution-spewing cars and trucks. Transportation accounts for about 28 percent of total U.S. greenhouse-gas emissions, making it the largest contributor of the pollution that is driving climate change. GM now faces the task of reorienting and revamping supply chains, assembly lines and its labor force to produce a new kind of product that few Americans have experienced.” – The Washington Post, January 28, 2021

Economic impact

The investment will lead to increased job opportunities for local communities:

• “Over 20 years, more than $28.8 billion in new personal income is expected to be generated by the direct, indirect, and induced jobs this opportunity will create, much of which will be spent at local small businesses throughout the community and the state. In addition, the project has an employment multiplier of 3.8, which means that an additional 2.8 jobs in Michigan’s economy are anticipated to be created for every new direct job, due to the extensive supply chain that exists in Michigan.” – State of Michigan Office of the Governor, January 25, 2022
• “It is on land that was conditionally transferred from the township to Lansing because at the time only the city, and not the township, could offer a 100% personal property tax abatement, [Bob Trezise, president and CEO of the Lansing Economic Area Partnership], said.” – Detroit Free Press, December 10, 2021
• Patrick Anderson, CEO of East Lansing-based Anderson Economic Group: “For each new full-time job created at a factory, typically two more jobs are created elsewhere in the state in relation to the plant. … It is a big multiplier effect that is related to those bona fide, new full-time jobs. … Then building the plants requires jobs in construction, where there is presently a shortage of workers, meaning high wages. It’ll be overtime work and extra pay and importing workers from other states to get that work done… That’s a positive because some of these workers will stay here. … They will also spend money at local restaurants and other businesses while working here.” – Detroit Free Press, January 25, 2022

The planned projects will provide well-paying, union jobs:

• “Because the Ultium plants are a joint venture, the UAW will have to organize the plants and negotiate a separate contract from the national agreement it has with GM at GM’s assembly, parts, and engine facilities.” – Detroit Free Press, January 25, 2022
• United Auto Workers (UAW) President Ray Curry and Terry Dittes, vice president and director of the UAW General Motors department: “For UAW Local 5960 Lake Orion the planned new products and advanced electric vehicle retooling builds on their plant’s history as a cutting edge manufacturing facility with a highly skilled and experienced EV workforce. … For UAW members at the GM Lansing Delta Township and Lansing Grand River Assembly plants the investments are commitments to continue and expand into new technologies as the industry transitions.” – Detroit Free Press, January 25, 2022
• “New workers [in Orion] can expect to earn an average hourly wage of $27, according to the MEDC. New workers in Delta Township will earn an average hourly wage of $22.50. The MEDC called all of them “pathway jobs,” due to the wages, training capability and benefits.” – Bridge Michigan, January 25, 2022

Official supporting statements

• State Rep. Stephanie A. Young (D-MI): “Having grown up in the Motor City, I am especially excited that, during my first year in office, the Legislature’s investment in good-paying manufacturing jobs for Michiganders is already paying off. Thank you, General Motors, for recognizing the incredible pool of talent that we have right here in Michigan. I am going to continue to fight to make Michigan a manufacturing hub for the cars of tomorrow. This investment in electric vehicle manufacturing shows that we can build economic prosperity and protect our environment. We don’t have to choose between the two — It’s win-win.” – Michigan House Democrats, January 25, 2022
• Gov. Whitmer: “GM’s $7 billion investment in Michigan-the largest in their history-will create and retain 5,000 good-paying jobs and enable us to build on our legacy as the place that put the world on wheels.”– State of Michigan Office of the Governor, January 25, 2022
• President Joe Biden: “This announcement is just the latest in over $100 billion of investment this past year in American auto manufacturing to build electric vehicles and batteries. … The Bipartisan Infrastructure Law was a major step toward this future by investing in EV charging, and Congress can catalyze more with additional incentives for Made in America electric vehicles, batteries, and semiconductors built by union hands.” – The White House, January 25, 2022

Selected clips

• “GM and LG to build 3 US EV battery factories with a $2.5B DOE loan” – Electrek, July 27, 2022
• “Lansing City Council approves tax exemption for $2.5B GM battery cell plant” – The Detroit News, December 20, 2021
• “Michigan approves $666 million incentive package for GM battery plant” – ABC12, March 10, 2022