Why EV Plants Are Going Off-Road

LG Energy Solution and GM are retooling their Tennessee plant for grid storage, signaling a seismic US gigafactory shift

30 Apr 2026

A joint venture between LG Energy Solution and General Motors is converting its Spring Hill, Tennessee plant from electric vehicle battery production to grid-scale energy storage. The partners have committed $70mn to the retooling, with the new lithium-iron phosphate cells due to enter production in the second quarter of 2026.

The decision reflects a concrete shift in market conditions. US electric vehicle sales fell 4% in 2025 after federal purchase credits expired, leaving factories designed for vehicle output running below capacity. Grid storage demand has moved in the opposite direction, driven by renewable energy expansion and surging electricity requirements at AI data centres.

Repurposing an existing plant is quicker and cheaper than building a new one.

The Tennessee facility joins four others in LG Energy Solution's North American storage network, spanning Michigan, Ohio, and Ontario. The company expects to produce more than 60 gigawatt-hours of storage batteries globally this year, with over 80% of that output coming from North American plants. The 700 workers furloughed at Spring Hill in January have begun returning.

The Spring Hill conversion is not an isolated case. At least ten North American battery plants are currently shifting capacity from vehicle to stationary storage use, redirecting a significant portion of a decade's worth of US gigafactory investment.

The US Energy Information Administration projects that battery storage will account for 28% of all new utility-scale power capacity added to the grid in 2026. Whether that demand proves durable enough to justify the scale of retooling now under way remains an open question.