South Korea’s LG Chem declared on Tuesday that Toyota Tsusho Corporation, a subsidiary of Japan’s automotive giant Toyota Motor Corporation, has purchased a 25% stake in its cathode active material plant in Gumi to expand the battery materials partnership.
LG Chem continues to hold a majority stake in the plant, operating under the name LG-HY BCM Company, with 51% maintaining its position as the principal shareholder. Toyota Tsusho is now the second-largest shareholder, following the sale of a 25% stake by China’s Zhejiang Huayou Cobalt Company, which lowered its share from 49% to 24%.
After the reduction of the Chinese company’s stake, the plant now adheres to the updated Prohibited Foreign Entity (PFE) regulations introduced by the U.S. government in July 2025. This enables the facility to align with the requirements of the U.S. Inflation Reduction Act (IRA) and become eligible for U.S. tax credits.
Toyota Tsusho plays a crucial role in sourcing raw materials for Toyota Motors. According to LG Chem, Toyota Tsusho intends to supply a portion of the cathode active materials produced at the Gumi plant primarily to battery manufacturers in North America.
The Gumi plant serves as a major production center for cathode materials, boasting an annual output capacity of 66,000 tons. It utilizes LG Chem’s proprietary Precursor Free (LGPF) technology, which bypasses the use of precursors by directly sintering custom-engineered metal feedstocks—a method LG Chem credits for its leadership in the cathode materials market.
The new partnership builds on a long-standing collaboration between LG Chem and Toyota in cathode materials development and supply.
In 2023, LG Chem signed a contract with Toyota Engineering & Manufacturing North America—Toyota’s North American manufacturing division—to supply 2.9 trillion won worth of cathode materials through 2030. This was then followed by another agreement last year to provide materials to Prime Planet Energy & Solutions, the joint venture between Panasonic and Toyota Motor Company, part of the Toyota Group.
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