Tennessee officials approved a $40 million incentive payment for LG Chem, which is planning to spend $3.2 billion to build a new cathode manufacturing facility in Clarksville.
Cathodes are an essential part of the electric vehicle battery supply chain. The facility will be the largest foreign direct investment in Tennessee’s history.
LG Chem committed to creating 860 net new jobs with an average wage of $33.42 per hour for those jobs with the $3.2 billion investment coming within the next eight years.
The proposal was in front of Tennessee’s State Funding Board on Nov. 28, along with a $4 million incentive for Landmark Recovery Management Company LLC in Franklin and a $1.86 million incentive for Gold Creek Foods LLC in Caryville.
The incentive payments all come with agreements from the companies that they will fulfill promises in terms of investments and jobs.
In its recent budget request hearing for next fiscal year, the Tennessee Department of Economic and Community Development requested a budget increase of $202.5 million. Of that, $103 million was requested for FastTrack grants like the one sent to LG Chem. The grants mainly to companies that are moving to Tennessee or expanding in the state.
The LG Chem facility is expected to produce roughly 120,000 tons of cathode material annually by 2027. That material will power batteries in 1.2 million electric vehicles with a range of 310 miles per charge.
The TNEDC did not announce the public incentive payment when it announced the project the week before.
"This is a big win for Tennessee and Montgomery County," TNEDC Commissioner Stuart McWhorter said. "LG Chem’s decision to locate its new cathode manufacturing facility in Clarksville underscores Tennessee’s growing profile as a hub for U.S. and global companies. As we continue our efforts to attract companies in the automotive industry, we are focused on supporting companies that boost Tennessee’s presence in the EV space."
Construction, expected to begin in early 2023, is expected to occur on 420 acres at the Allensworth site in Clarksville. Production is expected to begin at the facility in the second half of 2025.
LG Chem is based in Seoul, South Korea.
