LG Energy Solution has joined hands with U.S. electric commercial vehicle startup Indigo Tech to target the North American commercial vehicle market. LG Energy Solution said on Wednesday it signed a strategic memorandum of understanding with Indigo Tech. They agreed to discuss a plan to first apply its 46-series cylindrical battery cells to Indigo Tech’s next-generation electric commercial vehicles under development, including Flow Ride and Flow Cargo.

Founded in 2010, Indigo Tech has SmartWheels technology that integrates a drive unit and suspension inside a wheel. Based on the technology, which improves ride quality and expands interior space, it develops electric commercial vehicles for logistics and delivery and ride-hailing services. It is also pursuing a transportation-as-a-service business that combines charging infrastructure and digital mobility services with vehicles.

Alongside talks on a battery supply contract, the companies will also pursue technical cooperation. The goal is to match vehicle and battery performance by extending driving range and reducing charging time. Indigo Tech can secure battery technology and a stable supply base for next-generation electric commercial vehicles. LG Energy Solution will expand its supply references for the 46-series in North America.

LG Energy Solution plans to use the partnership to broaden its foothold in the North American electric commercial vehicle market. It is also scheduled to start operating a cylindrical battery plant in Queen Creek, Arizona within the year. The plan is to strengthen its local production base to increase new global orders for the 46-series. The company said shipments of cylindrical batteries in the second quarter rose 1.5 times from a year earlier thanks to stable mass production.

Will Graylin, Indigo Tech's CEO, said the electrification and automation of ride and delivery services are needed but suitable electric vehicles and charging infrastructure are not yet sufficient. He said advanced automotive battery technology through a long-term partnership with LG Energy Solution will offer better economics for vehicles, drivers and fleet operators.

Seong-hwan Oh (오성환), head of the marketing group in LG Energy Solution’s small battery business division, said it was meaningful that the company secured a new U.S. customer based on the competitiveness of its NCM-based 46-series, which has high energy density and fast charging performance. He said the company will use the partnership to expand its business into various electric commercial vehicle markets and further accelerate growth of its 46-series business.