Oxygen-free Copper
LS Group Chairman Koo Ja-eun has embarked on his first overseas business trip since taking office. The Korean business group has chosen electric vehicles as its future growth driver and is in full swing to reorganize its power infrastructure-oriented group into high-growth businesses such as batteries, electric vehicles, and semiconductors (switchboards).
According to LS Group on Sept. 9, Koo visited factories of LS Cable & System’s and Superior Essex’s (SPSX) European subsidiaries in Germany, Poland, and Serbia for a total of nine days from Feb. 2 to 10. The factories roll out windings for electric vehicles, battery parts, and communication cables.
SPSX, a U.S. wire company affiliated with LS Group, strategically acquired L&K, Europe’s largest producer of oxygen-free copper (OFC), in January of this year to meet explosively growing demand for electric vehicles in Europe. OFC is a high-purity copper with less than 0.001 percent oxygen and high conductivity.
L&K is a German company with an annual production capacity of 65,000 tons of OCP, a key material for making windings for electric vehicles’ drive motors. This is volume to be used in production of 20 million electric vehicles. The company also makes specialty cables for the high-tech space, aerospace, and medical industries.
LS emphasized that with the acquisition, it has secured an EV value chain, supplying L&K’s OCP to SPSX’s German and Serbian factories and high-efficiency windings for drive motors for electric vehicles to local automakers.
In response, LS is ramping up its investments in electric vehicles and batteries. Last month, it completed a nickel sulfate production plant with an annual capacity of 5,000 tons at Toricom’s plant in Asan, South Chungcheong Province, to strengthen its battery materials business. Toricom, a subsidiary of non-ferrous metal materials company LS MnM, is Korea’s largest urban mining company that recycles valuable metals such as gold, silver, platinum, and palladium, generating sales of about 32 billion won (US$24 million) in 2022.
To strengthen LS’ secondary battery business, Koo selected LS Materials as the first IPO target among LS affiliates after taking office. LS Materials is the world’s No. 1 manufacturer of large-sized products in the ultra-capacitor (UC) market, the next generation of secondary batteries. UCs are used to replace and complement primary batteries and lithium-ion batteries thanks to their fast charge/discharge and long life. They are mainly used in uninterruptible power sources, factory automation, and automated guided vehicles (AGV) at wind turbine and semiconductor factories.
LS Cable & System, through its subsidiaries LS EV Korea and LS EVC, has been supplying core components such as harnesses for electric vehicles and windings for motors. LS Group expects LS Materials to create synergies with other LS subsidiaries in new businesses such as offshore wind power and electric vehicles.
Through this transformation, LS aims to double its assets by 2030 to grow into a 50 trillion won business group. To realize this goal, the company plans to invest a total of more than 20 trillion won (US$15 billion) over eight years in the switchboard industry and new growth drivers to lead the way in carbon-free electricity (CFE).