Samsung SDI buys GM's 49.99% stake in $3.5 billion battery JV

Samsung SDI will acquire General Motors' 49.99 percent stake in their $3.5 billion battery joint venture in Indiana, ending the partnership as weaker-than-expected EV demand reshapes U.S. battery manufacturing plans.

"The ownership change was made in consideration of market changes since the joint venture was announced — including the slower-than-expected growth of EV demand," Samsung SDI said in a statement. "The two partners have now decided to seek other forms of cooperation other than the joint venture."

The plant in New Carlisle, Indiana, under construction since 2024, was initially expected to produce 27 gigawatt hours annually with mass production targeted for 2027. Samsung SDI will now use the facility for energy storage systems and other high-tech applications through its wholly owned unit, SDI-GM Synergy Cells Holdings. The company said specific investment plans had not yet been finalized and would be disclosed in accordance with regulatory requirements.

The deal follows GM's broader pullback from EV manufacturing after the loss of a $7,500 federal tax credit last September. In March, GM and LG Energy Solution converted another EV battery plant in Tennessee to ESS production. Samsung SDI separately signed an agreement with GM to jointly develop new prismatic batteries for potential future EV applications.

The acquisition consolidates Samsung SDI's control over U.S. battery production capacity at a time when the industry is pivoting from EV-specific plants toward multi-application facilities. The company already operates a 23-GWh EV battery plant in Indiana through a joint venture with Stellantis, which also produces ESS batteries. That existing footprint gives Samsung SDI a dual-track strategy in the state: one plant serving the Stellantis EV partnership, another now fully dedicated to ESS and other applications.

The restructuring highlights the competitive dynamics among battery makers in North America. LG Energy Solution, Samsung SDI's South Korean rival, has similarly pivoted its Tennessee facility with GM toward ESS. Panasonic Energy continues to supply Tesla from its Nevada operations, while SK On operates plants in Georgia and Kentucky. The shift toward ESS production across multiple facilities suggests battery makers see grid storage as a more predictable demand source than EV sales in the near term.

For GM, the transaction unwinds a vertical integration bet made two years ago when EV demand projections were more optimistic. The automaker retains access to Samsung SDI's prismatic battery technology through the new joint development agreement, preserving a path back into EV battery supply without the capital commitment of a dedicated plant. Prismatic cells — rectangular, rigid-cased batteries that differ from the cylindrical and pouch formats used in many current EVs — offer higher energy density and faster charging, making them a candidate for GM's future vehicle platforms.

The ESS pivot also reflects a structural shift in where battery demand is growing. Grid-scale energy storage installations in the U.S. have expanded rapidly as utilities integrate more intermittent renewable generation, creating a market for large-format battery cells that can be produced on the same manufacturing lines as EV cells. Samsung SDI's decision to repurpose the Indiana facility rather than abandon it suggests the company sees sufficient ESS demand to justify completing construction, though the timeline for commercial operations has yet to be determined.

The broader implication for the EV battery supply chain is that dedicated EV-only plants are becoming harder to justify at current demand levels. Automakers and battery makers that committed to aggressive capacity expansion during the 2021-2023 EV boom are now renegotiating those commitments, either by converting plants to dual-purpose facilities, slowing construction, or restructuring joint ventures entirely. The Indiana deal is the latest example of this recalibration, and it raises questions about whether other planned battery plants in the U.S. will face similar restructuring.

Samsung SDI shares traded down 4.83 percent on the Korea Exchange following the announcement, while GM shares rose 0.43 percent. The market reaction reflects investor uncertainty about the financial terms of the stake acquisition, which Samsung SDI has not yet disclosed, and the company's revised investment plans for the Indiana facility.

This article is for informational purposes only and does not constitute investment advice.