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URLhttps://www.supplychaindive.com/news/tesla-lg-to-build-43b-lfp-battery-plant-in-michigan/814976/
Last Crawled2026-04-12 10:58:47 (4 days ago)
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Meta TitleTesla, LG to build $4.3B battery plant as part of supply agreement | Supply Chain Dive
Meta DescriptionThe Michigan manufacturing facility is scheduled to open in 2027 and will provide batteries for Tesla’s Megapack 3 utility-scale energy storage systems.
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An article from The Michigan manufacturing facility is scheduled to open in 2027 and will provide batteries for Tesla’s Megapack 3 utility-scale energy storage systems. Published March 17, 2026 Reporter A Tesla battery energy storage system sits in Aberdeen, North Carolina, on June 10, 2022. Tesla’s latest supply deal with LG Energy Solution comes as the electric vehicle maker ramps up its energy storage production capabilities. Melissa Sue Gerrits via Getty Images This audio is auto-generated. Please let us know if you have feedback . Tesla and LG Energy Solution have agreed to build a $4.3 billion manufacturing facility in Lansing, Michigan, to produce lithium-iron-phosphate cells for Tesla's Megapack 3 utility-scale energy storage systems, according to the U.S. Department of the Interior. Production at the facility is scheduled to begin in 2027, the agency said in a press release . The facility will supply cells for Megapack 3 systems assembled at Tesla's Houston-area Megafactory. Tesla and LG did not immediately respond to a request for comment about the supply agreement. The LG deal comes as Tesla sees increasing interest in its energy generation and storage production capabilities. In 2025, the company ended the year with nearly $12.8 billion in revenue within the segment, representing a 26.6% year-over-year growth rate, CFO Vaibhav Taneja told investors during the company's Q4 2025 earnings call . "This was the result of higher deployments in all regions and continued strength in demand for both Megapack and Powerwall," Taneja said, referring to the company’s large-scale energy storage and home battery storage products, respectively. "As we look at 2026, our backlog remains strong, well diversified globally, and we expect increasing deployments with the launch of Megapack 3 and Megablock." In its Q4 earnings call presentation , Tesla reported that it planned to begin production of Megapack 3 and Megablock at its Houston facility this year. Meanwhile, LG, a major maker of electric vehicle batteries, also plans to expand its energy storage systems business. The company expects to book 90GWh of new grid-scale and other energy storage system orders this year and to expand its production capacity to over 60GWh, according to the company's 2025 financial results . It also said it plans to have more than 80% of its energy storage systems production capacity in North America. LG has emphasized energy storage systems while maintaining automotive partnerships, including two multi-year EV battery supply agreements with Mercedes-Benz. However, Ford cancelled a $6.5 billion battery supply contract with the company last year as the carmaker shifts its focus away from EVs. The latest partnership between Tesla and LG was confirmed as part of a broader package of projects meant to strengthen U.S. energy manufacturing, which included private sector commitments totaling $56 billion to secure critical energy supply chains in the U.S., according to the Interior Department. The commitments followed a meeting between the Trump administration and Indo-Pacific leaders from 17 countries. Other commitments stemming from the Indo-Pacific Energy Security Ministerial and Business Forum involved projects related to liquefied natural gas expansion, nuclear energy, coal-based power and fuel technologies. Mercedes-Benz, LG strike $11B EV battery supply deal By Eric Walz • Sept. 11, 2025 Ford cancels $6.5B battery supply contract with LG Energy Solution By Eric Walz • Dec. 23, 2025
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[Skip to main content](https://www.supplychaindive.com/news/tesla-lg-to-build-43b-lfp-battery-plant-in-michigan/814976/#skip-link-target) ![Supply Chain Dive](https://d12v9rtnomnebu.cloudfront.net/logo/publications/supplychain_black.svg) CONTINUE TO SITE ➞ [![Informa Tech Target Logo](https://d12v9rtnomnebu.cloudfront.net/logo/ITechTarget-Orbit-W_rgb.png) Informa TechTarget \|](https://www.informatechtarget.com/) - [Manufacturing Dive](https://www.manufacturingdive.com/) - [Retail Dive](https://www.retaildive.com/) - [Trucking Dive](https://www.truckingdive.com/) - [SearchERP](https://techtarget.com/searcherp//) [Explore our brands ![Informa Tech Target Brands](https://d12v9rtnomnebu.cloudfront.net/logo/link-external-wht.svg)](https://www.informatechtarget.com/our-brands/) [An Informa TechTarget Publication](https://www.informatechtarget.com/) [![Supply Chain Dive](https://d12v9rtnomnebu.cloudfront.net/logo/publications/supplychain_black.svg)](https://www.supplychaindive.com/) - [Deep Dive](https://www.supplychaindive.com/deep-dive/) - [Opinion](https://www.supplychaindive.com/opinion/) - [Library](https://www.supplychaindive.com/library/) - [Events](https://www.supplychaindive.com/events/) - [Press Releases](https://www.supplychaindive.com/press-release/) - Topics [Sign up](https://www.supplychaindive.com/signup/?signup_location=header) ![menu](https://www.supplychaindive.com/static/img/menu_icons/menu.svg?313321260226) - ![search](https://www.supplychaindive.com/static/img/menu_icons/search.svg?313321260226) Search - [![](https://www.supplychaindive.com/static/img/email_icons/mail.svg?313321260226) Sign up](https://www.supplychaindive.com/signup/?signup_location=header) - [Risk](https://www.supplychaindive.com/topic/risk-resilience/) - [Technology](https://www.supplychaindive.com/topic/technology/) - [Operations](https://www.supplychaindive.com/topic/operations/) - [Procurement](https://www.supplychaindive.com/topic/procurement/) - [Logistics](https://www.supplychaindive.com/topic/logistics/) - [Freight](https://www.supplychaindive.com/topic/freight/) - [Regulation](https://www.supplychaindive.com/topic/regulation/) An article from ![site logo](https://d12v9rtnomnebu.cloudfront.net/logo/printer_friendly/supplychaindive.jpg) # Tesla, LG to build \$4.3B battery plant as part of supply agreement The Michigan manufacturing facility is scheduled to open in 2027 and will provide batteries for Tesla’s Megapack 3 utility-scale energy storage systems. Published March 17, 2026 [![Antone Gonsalves's headshot](https://d12v9rtnomnebu.cloudfront.net/diveimages/Gonsalves_Antone_Default_circle-warm-150x150_Headshot.png)](https://www.supplychaindive.com/editors/agonsalves/) [Antone Gonsalves](https://www.supplychaindive.com/editors/agonsalves/) Reporter - [![Share this article](https://www.supplychaindive.com/static/img/social_icons/share-icon.svg?313321260226) Share]() - [![Copy link](https://www.supplychaindive.com/static/img/social_icons/share_dropdown/share-link-box.svg?313321260226) Copy link]() - [![Email this page](https://www.supplychaindive.com/static/img/social_icons/share_dropdown/email.svg?313321260226) Email](https://www.supplychaindive.com/cdn-cgi/l/email-protection#2c137f594e46494f581178495f404d091e6f091e1c606b091e1c5843091e1c4e59454048091e1c091e1818021f6e091e1c4e4d5858495e55091e1c5c404d4258091e1c4d5f091e1c5c4d5e58091e1c434a091e1c5f595c5c4055091e1c4d4b5e4949414942580a4d415c176e434855114458585c5f091f6d03035b5b5b025f595c5c40554f444d454248455a49024f43410342495b5f0358495f404d01404b015843014e5945404801181f4e01404a5c014e4d5858495e55015c404d42580145420141454f44454b4d4203141d18151b1a03) - [![Post to LinkedIn](https://www.supplychaindive.com/static/img/social_icons/share_dropdown/linkedin.svg?313321260226) LinkedIn](https://www.linkedin.com/shareArticle?mini=true&url=https%3A//www.supplychaindive.com/news/tesla-lg-to-build-43b-lfp-battery-plant-in-michigan/814976/&title=Tesla%2C%20LG%20to%20build%20%244.3B%20battery%20plant%20as%20part%20of%20supply%20agreement) - [![Post on X](https://www.supplychaindive.com/static/img/social_icons/share_dropdown/x.svg?313321260226) X/Twitter](https://twitter.com/intent/tweet?text=Tesla%2C%20LG%20to%20build%20%244.3B%20battery%20plant%20as%20part%20of%20supply%20agreement%20https%3A//www.supplychaindive.com/news/tesla-lg-to-build-43b-lfp-battery-plant-in-michigan/814976/%20via%20@SupplyChainDive) - [![Share on Facebook](https://www.supplychaindive.com/static/img/social_icons/share_dropdown/facebook.svg?313321260226) Facebook](https://www.facebook.com/sharer/sharer.php?u=https%3A//www.supplychaindive.com/news/tesla-lg-to-build-43b-lfp-battery-plant-in-michigan/814976/) - [![Print this page](https://www.supplychaindive.com/static/img/social_icons/share_dropdown/print.svg?313321260226) Print]() - [![License this article](https://www.supplychaindive.com/static/img/social_icons/article_page/license-icon.svg?313321260226) License](https://www.supplychaindive.com/selfservice/article-licensing/submit/?newspostUrl=https://www.supplychaindive.com/news/tesla-lg-to-build-43b-lfp-battery-plant-in-michigan/814976/) - [![Set preferred source](https://www.supplychaindive.com/static/img/social_icons/article_page/bookmark-add.svg?313321260226) Add us on Google](https://www.google.com/preferences/source?q=https://www.supplychaindive.com) ![a battery energy storage system made by Tesla](https://imgproxy.divecdn.com/14Iud8idwKui8Nxu_Sp5JscmrameGkvz9TkA3H98yuw/g:ce/rs:fill:1200:675:1/Z3M6Ly9kaXZlc2l0ZS1zdG9yYWdlL2RpdmVpbWFnZS9HZXR0eUltYWdlcy0xMjQxMjIwMDQ0LmpwZw==.webp) A Tesla battery energy storage system sits in Aberdeen, North Carolina, on June 10, 2022. Tesla’s latest supply deal with LG Energy Solution comes as the electric vehicle maker ramps up its energy storage production capabilities. Melissa Sue Gerrits via Getty Images ![](https://www.supplychaindive.com/static/img/play.svg?313321260226) Listen to the article 3 min This audio is auto-generated. Please let us know if you have [feedback](https://www.supplychaindive.com/contact/). Tesla and LG Energy Solution have agreed to build a \$4.3 billion manufacturing facility in Lansing, Michigan, to produce lithium-iron-phosphate cells for Tesla's Megapack 3 utility-scale energy storage systems, according to the U.S. Department of the Interior. Production at the facility is scheduled to begin in 2027, [the agency said in a press release](https://www.doi.gov/trump-administration-announces-deals-totaling-56-billion-during-indo-pacific-energy-security-summit). The facility will supply cells for Megapack 3 systems assembled at Tesla's Houston-area Megafactory. Tesla and LG did not immediately respond to a request for comment about the supply agreement. The LG deal comes as Tesla sees increasing interest in its energy generation and storage production capabilities. In 2025, the company ended the year with nearly \$12.8 billion in revenue within the segment, representing a 26.6% year-over-year growth rate, CFO Vaibhav Taneja told investors during [the company's Q4 2025 earnings call](https://seekingalpha.com/article/4863626-tesla-inc-tsla-q4-2025-earnings-call-transcript). "This was the result of higher deployments in all regions and continued strength in demand for both Megapack and Powerwall," Taneja said, referring to the company’s large-scale energy storage and home battery storage products, respectively. "As we look at 2026, our backlog remains strong, well diversified globally, and we expect increasing deployments with the launch of Megapack 3 and Megablock." In its [Q4 earnings call presentation](https://seekingalpha.com/article/4863644-tesla-inc-2025-q4-results-earnings-call-presentation), Tesla reported that it planned to [begin production of Megapack 3 and Megablock](about:blank) at its Houston facility this year. Meanwhile, LG, a major maker of electric vehicle batteries, also plans to expand its energy storage systems business. The company expects to book 90GWh of new grid-scale and other energy storage system orders this year and to expand its production capacity to over 60GWh, according to [the company's 2025 financial results](https://www.lgensol.com/en/company/newsroom-detail?seq=8727). It also said it plans to have more than 80% of its energy storage systems production capacity in North America. LG has emphasized energy storage systems while maintaining automotive partnerships, including two multi-year [EV battery supply agreements](https://www.wardsauto.com/news/archive-auto-mercedes-benz-secures-long-term-battery-supply-deal-11b-lg-energy-solution/759644/) with Mercedes-Benz. However, Ford [cancelled a \$6.5 billion battery supply contract](https://www.supplychaindive.com/news/ford-terminates-ev-battery-supply-deal-lg-energy-solution/808436/) with the company last year as the carmaker shifts its focus away from EVs. The latest partnership between Tesla and LG was confirmed as part of a broader package of projects meant to strengthen U.S. energy manufacturing, which included private sector commitments totaling \$56 billion to secure critical energy supply chains in the U.S., according to the Interior Department. The commitments followed a meeting between the Trump administration and Indo-Pacific leaders from 17 countries. Other commitments stemming from the Indo-Pacific Energy Security Ministerial and Business Forum involved projects related to liquefied natural gas expansion, nuclear energy, coal-based power and fuel technologies. ### Recommended Reading - [Mercedes-Benz, LG strike \$11B EV battery supply deal](https://www.supplychaindive.com/news/mercedes-benz-secures-long-term-battery-supply-deal-11b-lg-energy-solution/759884/) By [Eric Walz](https://www.supplychaindive.com/editors/ewalz/) • Sept. 11, 2025 - [Ford cancels \$6.5B battery supply contract with LG Energy Solution](https://www.supplychaindive.com/news/ford-terminates-ev-battery-supply-deal-lg-energy-solution/808436/) By [Eric Walz](https://www.supplychaindive.com/editors/ewalz/) • Dec. 23, 2025 - [![Set preferred source](https://www.supplychaindive.com/static/img/social_icons/article_page/bookmark-add.svg?313321260226) Add us on Google](https://www.google.com/preferences/source?q=https://www.supplychaindive.com) - [![Share this article](https://www.supplychaindive.com/static/img/social_icons/share-icon.svg?313321260226) Share]() - [![Copy link](https://www.supplychaindive.com/static/img/social_icons/share_dropdown/share-link-box.svg?313321260226) Copy link]() - [![Email this page](https://www.supplychaindive.com/static/img/social_icons/share_dropdown/email.svg?313321260226) Email](https://www.supplychaindive.com/cdn-cgi/l/email-protection#7c432f091e16191f084128190f101d594e3f594e4c303b594e4c0813594e4c1e09151018594e4c594e4848524f3e594e4c1e1d0808190e05594e4c0c101d1208594e4c1d0f594e4c0c1d0e08594e4c131a594e4c0f090c0c1005594e4c1d1b0e1919111912085a1d110c473e131805411408080c0f594f3d53530b0b0b520f090c0c10051f141d151218150a19521f13115312190b0f5308190f101d51101b510813511e0915101851484f1e51101a0c511e1d0808190e05510c101d12085115125111151f14151b1d1253444d48454b4a53) - [![Post to LinkedIn](https://www.supplychaindive.com/static/img/social_icons/share_dropdown/linkedin.svg?313321260226) LinkedIn](https://www.linkedin.com/shareArticle?mini=true&url=https%3A//www.supplychaindive.com/news/tesla-lg-to-build-43b-lfp-battery-plant-in-michigan/814976/&title=Tesla%2C%20LG%20to%20build%20%244.3B%20battery%20plant%20as%20part%20of%20supply%20agreement) - [![Post on X](https://www.supplychaindive.com/static/img/social_icons/share_dropdown/x.svg?313321260226) X/Twitter](https://twitter.com/intent/tweet?text=Tesla%2C%20LG%20to%20build%20%244.3B%20battery%20plant%20as%20part%20of%20supply%20agreement%20https%3A//www.supplychaindive.com/news/tesla-lg-to-build-43b-lfp-battery-plant-in-michigan/814976/%20via%20@SupplyChainDive) - [![Share on Facebook](https://www.supplychaindive.com/static/img/social_icons/share_dropdown/facebook.svg?313321260226) Facebook](https://www.facebook.com/sharer/sharer.php?u=https%3A//www.supplychaindive.com/news/tesla-lg-to-build-43b-lfp-battery-plant-in-michigan/814976/) - [![Print this page](https://www.supplychaindive.com/static/img/social_icons/share_dropdown/print.svg?313321260226) Print]() - [![License this article](https://www.supplychaindive.com/static/img/social_icons/article_page/cart.svg?313321260226) purchase licensing rights](https://www.supplychaindive.com/selfservice/article-licensing/submit/?newspostUrl=https://www.supplychaindive.com/news/tesla-lg-to-build-43b-lfp-battery-plant-in-michigan/814976/ "License") Filed Under: [Manufacturing,](https://www.supplychaindive.com/topic/manufacturing/) [Technology,](https://www.supplychaindive.com/topic/technology/) [Procurement](https://www.supplychaindive.com/topic/procurement/) ### Supply Chain Dive news delivered to your inbox Get the free daily newsletter read by industry experts ![Daily Dive newsletter example](https://www.supplychaindive.com/static/img/article-signup.png?313321260226) ### Editors' picks - [![Stanley Black & Decker products on display at Home Depot.](https://imgproxy.divecdn.com/mCa9fq86-NmEfp-BFQbx_VrVj2ULPmqJdkuDRAGXMDo/g:ce/rs:fill:1200:675:1/Z3M6Ly9kaXZlc2l0ZS1zdG9yYWdlL2RpdmVpbWFnZS9HZXR0eUltYWdlcy0yMjEzMDkxNTQ5LmpwZw==.webp)](https://www.supplychaindive.com/news/stanley-black-decker-supply-chain-financial-goals/805198/) ![Image attribution tooltip](https://www.supplychaindive.com/static/images/info-icon.png?234917240220) Michael M. 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[![Stanley Black & Decker products on display at Home Depot.](https://imgproxy.divecdn.com/mCa9fq86-NmEfp-BFQbx_VrVj2ULPmqJdkuDRAGXMDo/g:ce/rs:fill:1200:675:1/Z3M6Ly9kaXZlc2l0ZS1zdG9yYWdlL2RpdmVpbWFnZS9HZXR0eUltYWdlcy0yMjEzMDkxNTQ5LmpwZw==.webp)](https://www.supplychaindive.com/news/stanley-black-decker-supply-chain-financial-goals/805198/) ![Image attribution tooltip](https://www.supplychaindive.com/static/images/info-icon.png?234917240220) Michael M. Santiago via Getty Images ![Image attribution tooltip](https://www.supplychaindive.com/static/images/info-icon.png?234917240220) ### [Stanley Black & Decker leans on supply chain to hit financial goals](https://www.supplychaindive.com/news/stanley-black-decker-supply-chain-financial-goals/805198/) The world’s largest toolmaker plans to reduce its U.S. supply sourced from China from roughly 15% in 2024 to less than 5% by the end of 2026. By Antone Gonsalves • Nov. 12, 2025 - [![A person stands next to a machine in a warehouse surrounded by boxes.](https://imgproxy.divecdn.com/D3j0mbHyKkquTys7RLIxR4ZnuWjI1hiQngEO_wacyO4/g:ce/rs:fill:1200:675:1/Z3M6Ly9kaXZlc2l0ZS1zdG9yYWdlL2RpdmVpbWFnZS9HZXR0eUltYWdlcy0yMjQ5Njc3OTM1LmpwZw==.webp)](https://www.supplychaindive.com/news/supply-chain-risks-trends-outlook-2026/810852/) ![Image attribution tooltip](https://www.supplychaindive.com/static/images/info-icon.png?234917240220) Mario Tama via Getty Images ![Image attribution tooltip](https://www.supplychaindive.com/static/images/info-icon.png?234917240220) Deep Dive ### [Top supply chain risks and trends to follow in 2026](https://www.supplychaindive.com/news/supply-chain-risks-trends-outlook-2026/810852/) Explore how tariff changes, key supply shortages and volatile logistics capacity will test network resilience in this roundup of deep dives from Supply Chain Dive. By Phil Neuffer • Jan. 30, 2026 Latest in Manufacturing - [![Lamb Weston's "Crispy on Delivery" fries are pictured next to a hot dog.](https://imgproxy.divecdn.com/z2-fKtyGxSUFumDJeuUhXVfSfcUJUjOC66Sz94MjZCs/g:ce/rs:fill:600:338:1/Z3M6Ly9kaXZlc2l0ZS1zdG9yYWdlL2RpdmVpbWFnZS9mcmVuY2hmcmllc19sM1JzYURzLmpwZw==.webp)](https://www.supplychaindive.com/news/lamb-weston-iran-war-risks/816727/) [Lamb Weston warns of supply chain pressures amid Iran war](https://www.supplychaindive.com/news/lamb-weston-iran-war-risks/816727/) By Antone Gonsalves - [![A Matson vessel docked at a Southern California port terminal.](https://imgproxy.divecdn.com/-Q4DXJ6gEAbQCPyoeZPLUyGLjTckqrCwVhDwT4ZwGlI/g:ce/rs:fill:600:338:1/Z3M6Ly9kaXZlc2l0ZS1zdG9yYWdlL2RpdmVpbWFnZS9NYXRzb25fS2FpbWFuYV9IaWxhLmpwZw==.webp)](https://www.supplychaindive.com/news/tariff-refunds-confusion-after-supreme-court-decision-manufacturing/816952/) [Tariff refund process still unclear for many companies](https://www.supplychaindive.com/news/tariff-refunds-confusion-after-supreme-court-decision-manufacturing/816952/) By Jeffrey Kinney - [![Three people are on a screen during a panel discussion, framed by banners with the corresponding name and titles.](https://imgproxy.divecdn.com/ISrA6gy-SkFyme86NT_Lys2QdxqhkHwudo5ygl8_peg/g:ce/rs:fill:600:338:1/Z3M6Ly9kaXZlc2l0ZS1zdG9yYWdlL2RpdmVpbWFnZS9mb29kX2V2ZW50Mi5wbmc=.webp)](https://www.supplychaindive.com/news/food-manufacturers-product-assortments-strategies/816751/) [How food manufacturers are rethinking product assortments](https://www.supplychaindive.com/news/food-manufacturers-product-assortments-strategies/816751/) By Kelly Stroh - [![Cans of Hormel chili are displayed on a shelf.](https://imgproxy.divecdn.com/A6VIunO6Utg7QTtBHUkZAzFvKHy86f6ng2wt5q3-FZE/g:ce/rs:fill:600:338:1/Z3M6Ly9kaXZlc2l0ZS1zdG9yYWdlL2RpdmVpbWFnZS9HZXR0eUltYWdlcy0yMTY2MDgxNjQ2XzluVENNZXcuanBn.webp)](https://www.supplychaindive.com/news/hormel-supply-chain-ai-planning-platform/816293/) [Hormel modernizes supply chain with AI planning platform](https://www.supplychaindive.com/news/hormel-supply-chain-ai-planning-platform/816293/) By Antone Gonsalves *** ![Supply Chain Dive Logo](https://d12v9rtnomnebu.cloudfront.net/logo/publications/supplychain_black.svg) - [![linkedin icon](https://www.supplychaindive.com/static/img/social_icons/article_page/linkedin.svg?313321260226)](https://www.linkedin.com/company/supply-chain-dive-supply-chain-and-logistics-news) - [![facebook icon](https://www.supplychaindive.com/static/img/social_icons/article_page/facebook.svg?313321260226)](https://www.facebook.com/SupplyChainDive/) - [![x icon](https://www.supplychaindive.com/static/img/social_icons/article_page/x.svg?313321260226)](https://twitter.com/SupplyChainDive) - [![rss feed icon](https://www.supplychaindive.com/static/img/social_icons/article_page/rss.svg?313321260226)](https://www.supplychaindive.com/feeds/news/) #### Explore - [About](https://www.supplychaindive.com/about/) - [Editorial Team](https://www.supplychaindive.com/editors/) - [Contact Us](https://www.supplychaindive.com/contact/) - [Newsletter](https://www.supplychaindive.com/signup/?signup_location=footer-list&signup_path=/news/tesla-lg-to-build-43b-lfp-battery-plant-in-michigan/814976/) - [Purchase Licensing Rights](https://www.supplychaindive.com/selfservice/article-licensing/submit/) - [Press Releases](https://www.supplychaindive.com/press-release/) - [What We're Reading](https://www.supplychaindive.com/what-we-are-reading/) #### Reach our audience - [Advertising](https://www.supplychaindive.com/advertise/) - [Post a press release](https://www.supplychaindive.com/press-release/get-started/) - [Submit an opinion piece](https://www.supplychaindive.com/opinion/) - [Promote an event](https://www.supplychaindive.com/selfservice/event-listings/contact) #### Related Publications - [Manufacturing Dive](https://www.manufacturingdive.com/) - [Retail Dive](https://www.retaildive.com/) - [Trucking Dive](https://www.truckingdive.com/) - [SearchERP](https://techtarget.com/searcherp//) *** [![Informa TechTarget](https://www.supplychaindive.com/static/img/ITechTarget-Logo.png?313321260226)](https://www.informatechtarget.com/) This website is owned and operated by [Informa TechTarget](https://www.informatechtarget.com/), a global network that informs, influences and connects the world's technology buyers and sellers. © 2025 TechTarget, Inc. or its subsidiaries. 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An article from ![site logo](https://d12v9rtnomnebu.cloudfront.net/logo/printer_friendly/supplychaindive.jpg) The Michigan manufacturing facility is scheduled to open in 2027 and will provide batteries for Tesla’s Megapack 3 utility-scale energy storage systems. Published March 17, 2026 [![Antone Gonsalves's headshot](https://d12v9rtnomnebu.cloudfront.net/diveimages/Gonsalves_Antone_Default_circle-warm-150x150_Headshot.png)](https://www.supplychaindive.com/editors/agonsalves/) Reporter ![a battery energy storage system made by Tesla](https://imgproxy.divecdn.com/14Iud8idwKui8Nxu_Sp5JscmrameGkvz9TkA3H98yuw/g:ce/rs:fill:1200:675:1/Z3M6Ly9kaXZlc2l0ZS1zdG9yYWdlL2RpdmVpbWFnZS9HZXR0eUltYWdlcy0xMjQxMjIwMDQ0LmpwZw==.webp) A Tesla battery energy storage system sits in Aberdeen, North Carolina, on June 10, 2022. Tesla’s latest supply deal with LG Energy Solution comes as the electric vehicle maker ramps up its energy storage production capabilities. Melissa Sue Gerrits via Getty Images This audio is auto-generated. Please let us know if you have [feedback](https://www.supplychaindive.com/contact/). Tesla and LG Energy Solution have agreed to build a \$4.3 billion manufacturing facility in Lansing, Michigan, to produce lithium-iron-phosphate cells for Tesla's Megapack 3 utility-scale energy storage systems, according to the U.S. Department of the Interior. Production at the facility is scheduled to begin in 2027, [the agency said in a press release](https://www.doi.gov/trump-administration-announces-deals-totaling-56-billion-during-indo-pacific-energy-security-summit). The facility will supply cells for Megapack 3 systems assembled at Tesla's Houston-area Megafactory. Tesla and LG did not immediately respond to a request for comment about the supply agreement. The LG deal comes as Tesla sees increasing interest in its energy generation and storage production capabilities. In 2025, the company ended the year with nearly \$12.8 billion in revenue within the segment, representing a 26.6% year-over-year growth rate, CFO Vaibhav Taneja told investors during [the company's Q4 2025 earnings call](https://seekingalpha.com/article/4863626-tesla-inc-tsla-q4-2025-earnings-call-transcript). "This was the result of higher deployments in all regions and continued strength in demand for both Megapack and Powerwall," Taneja said, referring to the company’s large-scale energy storage and home battery storage products, respectively. "As we look at 2026, our backlog remains strong, well diversified globally, and we expect increasing deployments with the launch of Megapack 3 and Megablock." In its [Q4 earnings call presentation](https://seekingalpha.com/article/4863644-tesla-inc-2025-q4-results-earnings-call-presentation), Tesla reported that it planned to [begin production of Megapack 3 and Megablock](about:blank) at its Houston facility this year. Meanwhile, LG, a major maker of electric vehicle batteries, also plans to expand its energy storage systems business. The company expects to book 90GWh of new grid-scale and other energy storage system orders this year and to expand its production capacity to over 60GWh, according to [the company's 2025 financial results](https://www.lgensol.com/en/company/newsroom-detail?seq=8727). It also said it plans to have more than 80% of its energy storage systems production capacity in North America. LG has emphasized energy storage systems while maintaining automotive partnerships, including two multi-year [EV battery supply agreements](https://www.wardsauto.com/news/archive-auto-mercedes-benz-secures-long-term-battery-supply-deal-11b-lg-energy-solution/759644/) with Mercedes-Benz. However, Ford [cancelled a \$6.5 billion battery supply contract](https://www.supplychaindive.com/news/ford-terminates-ev-battery-supply-deal-lg-energy-solution/808436/) with the company last year as the carmaker shifts its focus away from EVs. The latest partnership between Tesla and LG was confirmed as part of a broader package of projects meant to strengthen U.S. energy manufacturing, which included private sector commitments totaling \$56 billion to secure critical energy supply chains in the U.S., according to the Interior Department. The commitments followed a meeting between the Trump administration and Indo-Pacific leaders from 17 countries. Other commitments stemming from the Indo-Pacific Energy Security Ministerial and Business Forum involved projects related to liquefied natural gas expansion, nuclear energy, coal-based power and fuel technologies. - [Mercedes-Benz, LG strike \$11B EV battery supply deal](https://www.supplychaindive.com/news/mercedes-benz-secures-long-term-battery-supply-deal-11b-lg-energy-solution/759884/) By [Eric Walz](https://www.supplychaindive.com/editors/ewalz/) • Sept. 11, 2025 - [Ford cancels \$6.5B battery supply contract with LG Energy Solution](https://www.supplychaindive.com/news/ford-terminates-ev-battery-supply-deal-lg-energy-solution/808436/) By [Eric Walz](https://www.supplychaindive.com/editors/ewalz/) • Dec. 23, 2025
Shard152 (laksa)
Root Hash4210623286016226752
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