Battery manufacturer plans $1.5 billion investment in Holland, up to 1,000 jobs – Michigan.
LG Energy Solution, a South Korean based electric vehicle battery manufacturer, plans to invest $1.5 billion in its Holland campus by 2025, creating more than 1,000 jobs, the company says.
Holland City Manager Keith Van Beek said in a memo that the state is offering the company an incentive package with an estimated value of $525 million, including a $10 million workforce housing loan program.
The incentive package includes a 20-year renaissance zone agreement, which enables the company to operate largely tax free at the site.
LG plans to build one new building and several support buildings, totaling roughly 1 million square feet, at its Holland campus, Van Beek’s memo says. The company’s campus is near the corner of 146th Avenue and Waverly Road.
Van Beek said in an interview with The Grand Rapids Press/MLive.
We’re excited about it.
“We think it’s a great commentary on what we offer here as being a place that people want to locate and develop and expand.”
The company’s renaissance zone request must be approved by the Holland City Council as well as the Michigan Strategic Fund board. The Holland City Council is hosting a 6 p.m. study session to learn more about the company’s plans.
LG Energy Solution, which formerly operated under the name LG Chem, announced in 2010 that it would build a lithium ion battery plant in Holland. The plant opened a few years later, and began producing lithium ion batteries for the Chevrolet Volt in summer 2013. That plant also received a renaissance zone designation from the city of Holland.
Companies located within a renaissance zone do not have to pay Michigan’s six-mill state education tax, local personal property tax and local real property tax, according to the Michigan Economic Development Corporation (MEDC). Taxes that still must be paid include local bond obligations, school sinking fund taxes, or special assessments, according to the MEDC.
According to a city memo, the 1,000 new jobs planned by LG are “well-paying,” though a specific hourly rate was not included. The company could not immediately be reached Friday afternoon to discuss the project, how much the new employees would be paid or when hiring is expected to begin.
The new plant would increase LG’s energy use by up to 40%, Van Beek’s memo states. To accommodate the increase, Holland Board of Public Works plans to build a $10 million substation near the new facility. Net “revenues are projected to cover the cost of this investment,” the memo states.
In a letter to Gov. Gretchen Whitmer, LG Vice President Allan Chung said the new plant would serve as a “human resource ‘incubating hub’ that takes the lead in nurturing next-generation Li-ion batter professionals.”
Gov. Gretchen Whitmer:
Thus, your seamless assistance and support, when inquired, during this course of journey will certainly be a help to ensure we stay and operate at the most competitive level in the market.
Van Beek’s memo mentions a new program providing $1 billion in state funds that was crated to attract large business projects to Michigan. However, the memo doesn’t explicitly state whether LG is seeking those funds. Van Beek deferred comment to the MEDC when asked whether LG is seeking a portion of those dollars. MEDC spokesperson Otie McKinley also declined to comment.
McKinley said in an email.
It would be premature to comment on any potential state support for this LG Energy Solution investment, we are proud to remain a global home for opportunity within the future of mobility and electrification.
“Michigan has long-standing and strong relationship with LG Energy Solution, and we remain grateful for the company’s decade-long investment in both manufacturing and R&D in the state.”
In addition to the city of Holland, the MEDC and Zeeland-based economic development group Lakeshore Advantage have been working with LG on its expansion plans.
“This has been a very competitive process, with other communities both in and out of the state vying for this project,” Van Beek said.
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Battery manufacturer plans $1.5 billion investment in Holland, up to 1,000 jobs, Holland, Mi. January 22, 2022
