UPDATE 1-Chevrolet Bolt EV battery production resumes

(Adds more details, closing stock price)

By David Shepardson

WASHINGTON, Sept 20 (Reuters) - General Motors Co said on Monday that battery production for its recalled Chevrolet Bolt electric vehicle had resumed and that battery replacements will begin next month.

GM said supplier LG battery plants in Holland and Hazel Park, Michigan, have resumed production and LG is adding capacity to provide more battery cells to GM.

Last week, the largest U.S. automaker said it would extend a shutdown of a Michigan assembly plant to mid-October following a new recall of its Bolt electric vehicles over battery issues after 13 reported fires. GM declined Monday to say when it might resume production of the vehicles.

GM shares recovered some of their earlier losses after the announcement, closing down 3.8% at $49.37.

GM in August widened its recall of the Bolt to more than 140,000 vehicles to replace battery modules, at a cost now estimated at $1.8 billion. The automaker said it would seek reimbursement from LG.

GM said on Monday "replacement battery modules will begin shipping to dealers as soon as mid-October."

GM says the root cause of the rare circumstances that could cause a battery fire is two manufacturing defects known as a torn anode and a folded separator.

GM said LG has implemented new manufacturing processes and has worked with GM to "review and enhance its quality assurance programs to provide confidence in its batteries moving forward."

Within about 60 days, GM will launch a new "advanced diagnostic software package that will increase the available battery charging parameters over existing guidance," it said.

The software is designed to detect "specific abnormalities that might indicate a damaged battery."

GM said owners should continue to park outside immediately after charging and not leave vehicles charging indoors overnight. (Reporting by David Shepardson; Editing by Aurora Ellis and Sonya Hepinstall)