LG Chem to open second battery factory in China
LG Chem has announced plans to construct a second battery plant in China for EVs. The new factory will be set in Nanjing like the first, and construction will begin this October. Battery production will likely start exactly a year later.
The South Korean company is responding to growing demand for battery cells, and plans to achieve an annual production capacity of 32 GWh in the new facility by 2023. This would provide enough batteries for 500,000 electrified vehicles. LG Chem is planning investments around two trillion Won (about 1.53 billion euro) to make this happen.
++ This article has been updated below. ++
Outside of China, LG is also operating battery factories for vehicle manufacturing in South Korea, the USA, the Netherlands and Poland. Their main customers include the US company GM, as well as Volvo, Renault, South Korea’s largest automobile manufacturer Hyundai and their subsidiary Kia.
LG Chem is under pressure, as is Samsung SDI, as both companies are losing ground to Chinese battery manufacturers. An analysis by market researchers at SNE research showed that both Korean manufacturers are losing ground to Chinese competitors.
Between January and April 2018, LG Chem delivered batteries with a total capacity of 1.671 GWh. That is a 38.9% increase compared to the same time period in the previous year. Despite the growth, the market percentage fell from 13.8% in 2017 to 10.6% this year. In the global rankings of battery cell manufacturers, LG fell from second to fourth place.
Update, October, 23, 2018: LG Chem has managed to stay on schedule and started construction of the battery cell facility as planned. They say they have broken ground for a three-story plant on the 198,300 sqm site (24 times the size of a football pitch) in Nanjing, China.
businesskorea.co.kr, donga.com, reuters.com, yonhapnews.co.kr (update, ground breaking)
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