GM to start replacing defective EV batteries by mid-October
04:33, 21 September 2021
US-based automotive major General Motors on Monday said it will start shipping replacement battery modules to dealers as soon as mid-October, a month after recalling its Chevrolet Bolt electric vehicles due to fire hazard risk in LG-made batteries.
In late August, Detroit-headquartered General Motors (GM) said it would take a $1bn hit from recalling Chevrolet Bolt electric vehicles (EVs) due to manufacturing defects in batteries supplied by LG Chem.
Shares of South Korean battery manufacturer LG Chem slumped over 11% on the news in August. LG Chem dropped further 12% since then, taking its year-to-date loss up to over 21%.
LG plant resumes production
On Monday, GM said battery production for its electric vehicle models has resumed at LG battery plants in Holland and Michigan, US.
GM added that LG is adding capacity to provide more batteries.
“LG has implemented new manufacturing processes and has worked with GM to review and enhance its quality assurance programs to provide confidence in its batteries moving forward,” said the automotive company in a press release.
What is your sentiment on GM?
No news on reimbursement
There was no mention of reimbursement GM said it would seek from LG Chem for supplying defective batteries.
GM said on Monday that new batteries will include an extended battery 8-year/100,000-mile limited warranty.
A software upgrade designed to detect abnormalities that might indicate a damaged battery will be launched within 60 days, added GM.
GM shares down
GM shares fell 3.8% overnight on Monday in line with of 1.7% drop in the S&P 500 index.
Trading in LG Chem shares will only resume when South Korean markets open on Wednesday after an extended weekend.
Read more: LG Chem hits five-month low on GM-related battery defects
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