S.Korea's LG Energy Solutions reviewing investment plan for Arizona plant

An employee walks past the logo of LG Energy Solution at its Seoul office building.

A company spokeswoman said on Wednesday that LG Energy Solution Ltd. LGES plans to reevaluate its investment plan for a standalone Arizona battery factory due to the current U.S. economic environment.

A spokesman for LGES said in a statement that, given the unprecedented economic conditions and investment circumstances in the U.S. LG Energy Solution is currently reviewing various investment options. The company, South Korea's biggest player in the booming market for electric vehicles and batteries, said no decisions have been made in its statement, which didn't mention the Arizona plan.

LGES shares fell by 2.6% in early trading, while the benchmark KOSPI index was down.

The statement comes just three months after LGES, which includes Tesla Inc, General Motors Co and Volkswagen AG, announced plans to build a battery factory in Arizona by 2024 to meet demand from startups and other North American customers.

In March, LGES said the plant would be its first U.S. factory to make cylindrical cells, a type of battery that has been used in Tesla and Lucid vehicles. It said that the construction would begin in the second quarter of 2022, with mass production expected to start in 2024.

In the United States, LGES is building three plants with GM in Ohio, Tennessee and Michigan and plans to expand its existing factory in Michigan.