EV Battery Makers Enjoying Energy-Storage Systems Battery Boom

After years of chasing the electric vehicle boom, some of the biggest U.S. battery manufacturers are shifting gears—literally and figuratively. With EV sales growth currently slowing and factories sitting underused, battery giants like LG and General Motors are finding new opportunities in an entirely different market: the power grid. The Wall Street Journal reported this news on July 21, 2025.

As well as supplying carmakers, these companies are now also focusing on energy storage systems (ESS) for utilities, renewable energy developers, and the booming data center sector fueling artificial intelligence. Once a niche, stationary energy storage has exploded into a hot market. From 2021 to 2024, U.S. installations more than tripled, and industry analysts at Wood Mackenzie expect 34% growth in 2025 alone.

“If you have an outage of a massive data center or a giant gas plant, batteries can plug that hole,” said Stephanie Smith, chief operating officer of Eolian, a battery and renewable-energy company owned by asset manager BlackRock. “They can react in microseconds, and so you’re able to address so many different problems on the entire grid.”

This pivot couldn’t come at a better time. America’s electricity demand—stagnant for over a decade—is rising sharply again, driven by AI data centers, manufacturing, and broader electrification efforts. Grid operators increasingly need large-scale batteries to stabilize power supply, manage peak demand, and prevent outages.

Battery makers are adjusting quickly. LG’s battery division, which co-owns EV plants with GM, Honda, and Hyundai, rethought its strategy in late 2023. Facing waning EV demand, LG repurposed its $1.4 billion expansion in Holland, Michigan. Originally meant for EV batteries, the facility will now exclusively produce stationary batteries using the same low-cost chemistry perfected by Chinese rivals.

“We saw there is a rapid and urgently growing demand in the U.S. Here’s an opportunity for us to address it more quickly,” said Tristan Doherty, LG’s chief product officer for storage batteries. The pivot put LG into the U.S. energy-storage business a year earlier than planned, he said.

General Motors is also testing the waters, announcing a potential partnership with battery recycler Redwood Materials to supply both new and used GM batteries for storage projects.

“Right now, there is a hunger for more energy from every source,” Redwood founder J.B. Straubel said.

Other companies are making similar moves. A Chinese-owned battery manufacturer that once planned to supply Mercedes-Benz is now eyeing energy storage as a path forward for its stalled Kentucky factory.

Excelsior Energy Capital, which develops utility-scale solar and battery projects, has already signed on to buy LG’s new U.S.-made batteries. “Having a domestic supply helps ensure our timelines and budgets stay intact,” said Excelsior co-founder Anne Marie Denman.

“We can look our buyers of power straight in the eye and say, ‘This is a domestically sourced supply chain and we can commit to these timelines,’ ” said Denman. “It isn’t subject to geopolitical winds.”

While the transition won’t erase the hit from a sales growth slowdown in EV sales—LG’s battery unit saw a 24% drop in revenue last year—it may offer a long-term lifeline. The company is cutting capital spending by up to 30% and expects U.S. EV demand to drop another 10% this year. But with grid demand surging and storage needs growing, the battery business may be charged up once again—just not the way it was originally planned.

EVinfo.net’s Take

This move to ESS is a perfect synergy for EV battery makers. Although EV sales growth is currently slowing, EV advocates have no reason to be concerned. As with all products sold, EVs will have ups and downs in their sales cycle. Long-term, EVs will replace the less efficient, less eco-friendly gas and hybrid vehicles on a massive, worldwide scale. The most compelling reason is that the EV needs far less maintenance than the hybrid or gas vehicle, and is far less expensive to charge than the high environmental and financial costs involved with vehicles burning gasoline.

The current EV sales growth slowdown in the US will tick back up, no doubt. The US is far behind the rest of the world’s leading markets in EVs, and since this is not economically sustainable, this deficit will not last long. Political leaders opposing EVs and solar energy will soon realize doing so is a big mistake, since these policies drag down our economy.