Battery manufacturer LG Energy Solution recently announced that its Arizona subsidiary has signed a long-term vehicle supply agreement with US automaker Rivian for 4695 cylindrical batteries. The cells will be produced at LG Energy Solution's new independent Arizona facility starting next year and will power Rivian's upcoming R2 BEVs.
LG Energy Solution (LGES) is a subsidiary of LG Chem that focuses on the development and production of batteries. In the short four years since the business was founded, the Korean company has established partnership agreements and supplying OEMs worldwide and is currently one of the leaders in its market following the long-standing CATL.
When the Biden administration introduced the Depreciation Reduction Act, which included tax incentives for BEVs and their batteries assembled on US soil, LGES was one of the most popular battery manufacturers that OEMs reached out to in order to stop local cell production in North America.
Since then, we have seen institutional plans announced between LGES and car manufacturers such as Hyundai Motor Group, Stellantis, Honda, and Ford, which recently decided to bring its operations outside of Europe. Toyota also has an agreement to supply LG Energy Solution.
In 2022, we covered the news that LG Energy Solution was investing $450 million to produce 4680 battery cells, a format pioneered by Tesla. The company has since developed a long, high-capacity cell called the 4695.
Today, the company announced a new contract for those 4695 cylindrical batteries, which will be produced in Arizona and delivered to Rivian for its R2 models.
The Rivian R2 will be powered by LG Energy Solution batteries
LG Energy Solutions shared details of their latest supply agreement this afternoon. The company has signed on to supply Rivian with its advanced 4695 cylinder batteries for more than five years, delivering a total capacity of 67 GWh during that time.
The name “4695” refers to the size of the battery cells, which are 46mm wide and 95mm tall. LG Energy Solution explained that its 20 years of research and development of cylindrical batteries has gone into its next-generation 4695 Rivian cells.
The battery specialist says its larger cells will provide OEMs with longer range and higher safety while delivering six times the capacity of the 2170 cylindrical cells popular in BEV battery modules today. LG Energy Solution CEO David Kim talked about the company's 4695 batteries and its durability agreement with Rivian:
Due to the dynamic nature of the current EV market, an increasing number of vehicle manufacturers around the world are showing a strong choice of different types of battery materials. This large order from Rivian for 4695 batteries marks a milestone for LG Energy Solution in expanding its customer base within the cylindrical battery segment.
Today, we also learned that Rivian's batteries will eventually be made at its standby facility in Arizona during the first year of production, and then shipped to Rivian's assembly plant in Normal, Illinois, where they will be used in the R2 models sold in the North. American market.
Construction of LGES' Arizona facility is underway and is expected to be completed and begin full production in less than two years from now.
The Rivian R2 launched last March in spectacular fashion, and over 100,000 pre-orders have already been placed. It will be assembled at the General Assembly, IL, and may eventually move to the American Automaker's second manufacturing facility, which is still under construction in Georgia.
During its presentation, Rivian shared that it expects the R2 BEV to reach the market in the first half of 2026. If that timeline holds, it should be around then that LG Energy Solutions starts producing batteries for those Rivian models in Arizona.
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