Only weeks after starting up long-delayed production of lithium-ion batteries for the Chevy Volt at their new factory in Holland, Michigan, LG Chem has announced that they are stopping production for up to six weeks because a compound used in that production apparently had not been registered for use in manufacturing with the U.S. Environmental Protection Agency. While no shutdown order was issued by the EPA, the agency recently issued a subpoena to LG Chem, demanding a list of chemicals used at the Holland facility.
LG Chem spokesman Jeremy Hagemeyer said in an email to news agencies, “We discovered the possibility that this material may not be properly registered and made the decision to pause our production until we have that question resolved. We are currently reviewing the registration status and will work with the EPA to resolve the issue quickly. In the meanwhile, we are delaying production activities for approximately 6 weeks until we have confirmed the registration status or otherwise obtain approval from EPA.”
The $303 million factory was partially funded with a $151 million federal stimulus grant to produce batteries for electric and hybrid cars. President Obama spoke at the groundbreaking ceremony for the facility in 2011. The plant had more recently been in the news when it was discovered that employees were idle there. LG Chem at the time said that the plant’s output was not immediately needed because lower than anticipated sales of the Volt meant that their Korean operations were capable of supplying all the batteries needed for Chevy’s range-extended EV. After an audit by the U.S. Auditor General determined that employees were indeed not doing production work, LG Chem reimbursed the federal government $842,000.
Hybrid and EV sales are up this year and GM will soon start selling the Cadillac ELR, which shares the Volt’s “Voltec” powertrain, increasing the automaker’s demand for batteries. Test builds on the LG Chem production line in Holland began in May. Last month LG Chem said that mass production has started at their Michigan facility and that after those batteries’ conditioning period was over the factory would begin shipments to GM by October for use in the Volt.
Hagemeyer said that during shutdown there would be no layoffs. Employees will be engaged in continuous improvement projects, training and maintaining readiness, according to the company. ”We view this as a temporary issue and are very confident that we will proceed with production soon,” he said, stressing that the plant is safe. So far, General Motors has not commented on the battery production shutdown.