DETROIT (AP) -- General Motors Corp. on Monday named LG Chem Ltd. of South Korea as the lithium-ion battery supplier for its Chevrolet Volt electric car, and the automaker also announced the seeds of what could become a battery development and manufacturing center in Michigan.
LG Chem will make the battery cells in Korea and ship them to the U.S., where they will be assembled into packs at an unspecified GM factory in Michigan, both companies said at the North American International Auto Show.
GM Chief Executive Rick Wagoner said the battery assembly facility will be the first in the U.S. operated by a major automaker.
LG Chem CEO Peter Kim said the company may eventually build cells in Michigan, and it anticipates that its U.S. subsidiary, Compact Power Inc., will add to its 100-person work force in Troy.
Volt vehicle line director Tony Posawatz said GM also will open a new battery lab at its Warren technical center. The 31,000-square-foot battery lab will be the largest in the U.S., GM said.
Posawatz would not comment on how many jobs might be created in manufacturing or battery development, but he said GM's ventures are likely to lure research facilities and factories from other electric vehicle parts suppliers.
"We have enough critical mass that future growth will cluster," Posawatz said.
Southeast Michigan around Detroit, he said, is the likely front-runner for the factory, which would be near the Volt assembly plant, an existing facility that straddles the border between Detroit and the tiny enclave of Hamtramck.
Any new jobs would be good news for Michigan, where the shrinking auto-dependent economy has led to a nation-leading 9.6 percent unemployment rate.
GM and the University of Michigan also announced the joint development of a battery research center at the Ann Arbor school. The center will train engineers in battery development and test batteries to improve their life and performance through a five-year, $5 million award that will establish the GM/U-M Advanced Battery Coalition for Drivetrains.
Three Michigan professors and a faculty member at the University of Colorado at Colorado Springs are working on the project.
"Our shared ambition is to see electrified drive trains in a large number of vehicle types and applications. That means we need to reduce the design cycle in both time and cost," Michigan engineering professor Ann Marie Sastry, the lab's co-director, said in a news release.
Wagoner said GM is integrating battery research and assembly into its mainstream to develop powertrains of the future.
"We believe this will become a competitive advantage for GM and will be critical to GM's success," he said.
Michigan Gov. Jennifer Granholm welcomed GM's plans to begin battery-pack production in Michigan, which has begun offering incentives to draw companies working in energy storage and batteries.
"We have worked aggressively to become a worldwide leader in advanced battery development and production, and GM demonstrates that Michigan is the place to be," Granholm said in a statement.
The governor also said she'd like see the federal government invest more in alternative energy technologies. On Sunday, Michigan Sen. Carl Levin called for aiming $1 billion in federal funding for grants to U.S. companies involved in developing and making advanced batteries in the proposed economic recovery package.
Detroit-based GM had planned to name a battery supplier early last year but decided to keep working with two developers simultaneously to test their batteries under a variety of conditions. The other company that was in the running for the contract was Frankfurt, Germany-based Continental Automotive Systems, which is using cells developed jointly by GM and A123 Systems Inc.
Posawatz said GM chose LG Chem because of its flat-cell design that dissipates heat better and stores more energy than competitors' cylinder-shaped cells.
The competition from A123 Systems Inc. of Watertown, Mass., was very capable, Posawatz said, but "one has to be the lead."
LG Chem's Kim said the GM contract boosts his company's global presence.
"We now are a global player. We have many plants sited worldwide. So it would be possible to produce it in the United States in the future," he told The Associated Press in an interview.
The current LG Chem was established in 1947 and besides batteries, also produces petrochemicals. LG Chem is a member of the LG Group, a major South Korean industrial conglomerate with interests in areas including electronics, flat panels, telecommunications and logistics.
LG, once known as Lucky Goldstar, changed its name in 1995. The company's motto is "Life's Good."
LG Electronics acquired U.S. television manufacturer Zenith Electronics Corp. in 1995 and is known for its flat-screen televisions, mobile phone handsets, personal computers and household appliances, including refrigerators and washing machines.
Kim said LG Chem's lithium-ion battery chemistry uses manganese instead of cobalt, making it more stable than batteries made by other manufacturers.
"Our pack system is quite different," he said. "This is very safe. The release of the heat is good."
The Volt is designed to plug into a standard wall outlet and travel 40 miles on battery power alone. After that, a small internal combustion engine will kick in to generate power for the car.
The car is set to go on sale next year. GM hasn't announced pricing, but it is expected to cost $30,000 to $40,000 initially.
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AP Business Writer Kelly Olsen in Seoul, South Korea, and Associated Press Writer Kathy Barks Hoffman in Lansing, Mich., contributed to this report.
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On the Net:
Chevrolet Volt: www.chevrolet.com/electriccar
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