LG Energy Solution said Wednesday it plans to sell the building of its Ohio electric vehicle battery joint venture with Honda to its partner for 4.2 trillion won ($2.9 billion), a move aimed at easing capital pressure as global EV demand slows.
According to regulatory filings, LG Energy Solution will dispose of the building and related facilities of the L-H Battery Company — excluding land and production equipment — to Honda’s U.S. unit. The final transaction value may change following due diligence and foreign exchange adjustments, with completion targeted for Feb. 28.
Despite the sale, the joint venture will continue operating the facility under a lease agreement, and both companies confirmed there will be no changes to production or operational plans. Battery production for Honda’s North American electric vehicle lineup is scheduled to begin next year, with potential expansion into energy storage system applications.
By transferring ownership of the building while retaining operational use, LG Energy Solution expects to reduce its upfront investment burden. Construction costs typically account for the largest portion of total capital expenditures in large-scale battery manufacturing projects, making the sale a strategic liquidity move rather than a retreat from the joint venture.
The Ohio facility, located in Jeffersonville, represents one of LG Energy Solution’s key manufacturing investments in North America, developed in partnership with Honda to support localized EV battery production. Leasing the building back allows the battery maker to free up cash tied to fixed assets while maintaining its long-term production roadmap.
The decision comes as global EV demand growth moderates and U.S. consumer incentives face uncertainty. LG Energy Solution said the transaction aligns with its broader strategy to strengthen financial flexibility and manage risks linked to market volatility.
An LG Energy Solution official stated, “The joint venture with Honda remains a key strategic base in North America,” adding that the partners will continue to respond flexibly to changing market conditions while laying the groundwork for sustainable mid- to long-term growth.
Industry observers view the move as a financial optimization strategy increasingly adopted by manufacturers navigating high capital costs and evolving EV market dynamics. With production plans unchanged, the Ohio joint venture remains central to both companies’ North American electrification strategies.
Originally reported by The Korea Herald.
