Tesla has partnered with South Korea–based LG Energy Solution to develop a $4.3 billion lithium iron phosphate (LFP) battery manufacturing facility in Lansing, Michigan.

The plant is expected to begin production in 2027 and will produce prismatic LFP battery cells for Tesla’s Megapack 3 energy storage systems, which are assembled in Houston. The project is intended to support the expansion of a domestic battery supply chain in the United States.

LG Energy Solution is among a limited number of companies currently producing LFP batteries in the U.S., a sector that has historically been dominated by manufacturers based in China.

LFP battery technology is commonly used in energy storage applications due to its lower cost, longer lifespan, and improved safety characteristics compared to other battery chemistries.

The agreement reflects broader efforts to increase domestic production capacity and reduce reliance on overseas battery suppliers.