Mercedes-Benz places billion-dollar EV battery bet on LG

The world's biggest car companies are revealing their long-term vision for the road ahead, and that vision is entirely electric. Despite some news reports suggesting a temporary slowdown in EV sales, German automaker Mercedes-Benz just secured a massive, seven-year battery supply deal with Korea's LG Energy Solution (LGES), suggesting that its commitment to EVs is not slowing down at all - it is, in fact, just getting started.

The new agreement is a powerhouse of a contract, valued at $1.4 billion for high-voltage batteries. It locks in supply between March 2028 and June 2035, ensuring that Mercedes-Benz electric cars sold in both Europe and North America will have the cells they need. The deal is so big that it completely overshadows any small concerns about too many batteries hitting the market or a dip in short-term EV demand.

In fact, this is the second time this year alone that LG Energy Solution has signed a major battery order with the Stuttgart-based manufacturer. Back in September, the Korean company committed to supplying a total of 32 GWh to Mercedes-Benz by 2035 and another 75 GWh to an affiliate company by the end of 2037. When you look at the total scale, it's clear that the appetite for these power packs is booming.

The reason for this immense battery hunger comes from a total makeover planned inside Mercedes-Benz itself. The company sees the future, and it looks much sharper than some of its earlier electric cars. The automaker is moving away from the "jellybean-shaped" designs of models like the EQS and EQE, which received a lukewarm welcome from buyers. Instead, the company is preparing for what it calls its "biggest product launch program" in history - a plan to roll out 15 new or refreshed electric models in the next two years.

These new EVs ride on brand-new, dedicated platforms built from the ground up. A great example is the new CLA EV. This sleek, next-generation sedan uses the advanced 800V Mercedes Modular Architecture (MMA), which allows for much faster charging speeds. The new GLC with EQ Technology is already available to order as well. This SUV sits on the 800V MB.EA platform, another cutting-edge design meant to deliver top performance and efficiency.

Mercedes-Benz is planning its product offensive, and LG Energy Solution is cementing its place as a cornerstone supplier for the entire EV industry. The company is certainly not putting all its eggs in one German basket. It recently signed a $4.3 billion deal with Tesla for lithium-iron phosphate batteries that are used for energy storage.

The company is also hard at work developing advanced, high-power lithium manganese-rich (LMR) battery cells for General Motors. These LMR cells are destined for GM's full-size electric trucks and SUVs starting in 2028.

These massive, multi-billion-dollar supply contracts - from the $1.4 billion pact with Mercedes-Benz to the $4.3 billion deal with Tesla - are a clear sign that the global automotive industry has fully committed to an electric future. Short-term market blips are just noise; the long-term reality is that the factories of both car makers and battery suppliers are being set up for a world where EVs dominate.

Via