General Motors (GM) and Samsung SDI have finalized their joint venture for a cutting-edge electric vehicle (EV) battery cell plant in New Carlisle, Indiana. However, the production timeline has been pushed back due to a slowdown in U.S. EV sales. Initially set to begin in 2026, the plant’s operation is now expected to commence in 2027.

This delay, though under a year, highlights the current market conditions where consumers remain cautious, primarily concerned about EV range and charging infrastructure. Despite the slowdown, U.S. EV sales did grow by 7% in the first half of this year, according to Motorintelligence.com, with EVs maintaining a 7.6% share of the new vehicle market.

The $3.5 billion plant, located near South Bend on a sprawling 680-acre site, is a significant step in GM’s electrification strategy. Expected to employ 1,600 workers, the facility will produce advanced nickel-rich prismatic batteries. These batteries are designed to offer more energy storage, reducing costs and enhancing driving range, a critical factor as the EV market matures.

This Indiana plant marks GM’s fourth joint venture battery cell factory, following previous collaborations with South Korea’s LG Energy Solution. The shift to Samsung comes after several recalls of Chevrolet Bolt EVs equipped with LG batteries due to defects leading to fires.

While construction is already underway, the delay in production reflects broader trends in the industry. Major automakers, including GM, have been reconsidering their EV and battery production timelines. Just last week, Ford announced a delay in the launch of its large electric pickup by 18 months and canceled plans for a three-row electric SUV, choosing instead to concentrate on electric midsize pickups and commercial vans.

The joint venture with Samsung not only solidifies GM’s commitment to electrification but also opens the door for Samsung to establish a foothold in the North American EV market, supplying battery cells to other manufacturers. As the EV market evolves, this strategic partnership positions both companies to navigate the challenges and opportunities ahead.