Electric Vehicles: LG Energy Solution Chooses Morocco to Secure Lithium Supplies

Morocco’s gigafactory ecosystem is taking form. South Korean LG Energy Solution Ltd, the world’s 2nd-largest battery maker for electric vehicles, turned to Morocco to secure lithium supplies through an association with Chinese Yahua.
On Wednesday, LG Energy Solution Company signed a Memorandum of Understanding with lithium compound manufacturer Yahua to produce lithium hydroxide in the North African Kingdom.
The MoU will enable the South Korean firm to enhance its supply chain for cathode materials, including lithium hydroxide, which is a key component in high-nickel, high-capacity EV batteries.
Morocco has sealed Free Trade Agreements (FTAs) with the U.S. and the European Union, making it an attractive location for the production of lithium hydroxide.
The deal will also enable LG Energy Solution to respond more flexibly to fast-changing external business environments with regulations such as the U.S. Inflation Reduction Act (IRA) and the EU’s Critical Raw Materials Act.
The production of lithium hydroxide in Morocco is favorable for meeting the U.S. requirements. Under U.S. regulations, only EVs that use a certain percentage of key minerals from the U.S. or a country that has a FTA with the U.S. can be subsidized.
Yahua is among the world’s leading producers of lithium hydroxide, which is easily synthesized with nickel, making it an essential ingredient in the production of high-energy-density EV batteries.
LG Energy Solution expects to secure a stable supply of high-quality lithium hydroxide by leveraging Yahua’s manufacturing technology.