Ultium Cells LLC, the joint venture between General Motors and LG Energy Solution, is set to begin manufacturing lithium-iron phosphate (LFP) battery cells for energy storage systems (ESS) at its Spring Hill, Tennessee, facility in the second quarter of 2026. The move follows a $70 million retooling investment aimed at addressing rising demand for grid-scale storage and power support for AI data centers.

Under the plan, the finished LFP cells will be supplied to LG Energy Solution’s Vertech division, which integrates battery cells, proprietary software, lifecycle services, and extended warranties into large-scale, U.S.-made ESS enclosures. These systems are intended for utility-scale and data center projects throughout North America. The Spring Hill operation will draw on technology and operational expertise developed at LG Energy Solution’s dedicated ESS battery facility in Holland, Michigan.

LG Energy Solution aims to boost its global ESS production capacity to over 60 GWh this year, with more than 80 percent based in North America. The Spring Hill site will become part of a regional manufacturing network that includes wholly owned facilities in Holland and Lansing, Michigan; Windsor, Ontario; and the L-H Battery Company joint venture with Honda. By the end of 2026, each of these locations will dedicate at least part of its output to the company’s JF2 LFP pouch cell, its standard ESS product.

According to Bob Lee, president of LG Energy Solution North America, the Spring Hill facility strengthens the company’s ESS presence in North America and broadens its product portfolio “to provide tangible benefits to American competitiveness in this decade and beyond.” ESS installations support grid modernization and expansion, help stabilize power output, and reduce lead times for infrastructure and data center construction by storing electricity from both traditional and renewable sources.

LFP chemistry has emerged as the preferred option for stationary storage, largely due to its cost advantages over the high-nickel batteries used in electric vehicles. Injae Pahk, president and CEO of Ultium Cells, noted that the retooling reflects the company’s transition into a diversified cell manufacturer and reinforces its long-term position as a key employer and technology leader in the U.S. battery sector.

Workers at the facility are undergoing retraining to support ESS LFP cell production, and roughly 700 employees who were furloughed in January are expected to return as the retooling process nears completion. Ultium Cells’ flexible manufacturing platform allows for multiple chemistries, with NCMA GEN1 cell production now consolidated at its Warren, Ohio, plant.