Center of Development
Japan is pushing to build a global supply chain alliance to take the initiative in the secondary battery industry by 2030. It laid out an ambitious plan to become the center of secondary battery development and production in partnership with the United States, the European Union and the world’s major resources-rich countries. However, Japan has excluded Korea, a major consumer of Japanese secondary battery materials, from the supply chain initiative.
Japan’s Ministry of Economy, Trade and Industry (METI) said on June 6 that it has revised its semiconductor and digital industry strategy, which outlines policy directions for high-tech industries such as semiconductors, information processing infrastructure, and secondary batteries. It was the first revision in more than two years since it was announced in 2021.
“Responding to economic security risks, digitalization and greening is growing in importance,” METI said. “Based on these changes, METI will accelerate its response to semiconductors and secondary batteries.”
In the secondary battery sector, the Japanese ministry’s slogan is to make Japan the world’s center for the development and production of secondary batteries. To realize this, it plans to secure a manufacturing capacity of 150 GWh in Japan and 600 GWh globally by 2030.
In particular, the METI presented a road map to strategically form a global alliance to secure leadership in the secondary battery industry. It said it will strengthen ties with Canada, Australia, the United States, Europe, and resources-rich countries in Southeast Asia and Africa. Korea was not mentioned as a partner.
The Japanese ministry specifically included the word “G7@Hiroshima” in its supply chain strategy. This was likely an allusion to the Group of Seven (G7) meeting held in Hiroshima in May as a preliminary stage for building a secondary battery supply chain.
The Korean industry had hoped that bilateral cooperation in secondary batteries would be strengthened between Korea and Japan following the warming of their bilateral ties after last month’s summit between Japan and Korea. Recently, there have been various examples of cooperation such as LG Energy Solution and Honda building a joint venture plant in the United States and LG Chem and Toray building a separator plant in Europe.
However, with the Japanese government’s future strategy virtually leaving Korea out from the supply chain alliance, Korea is not sure of partnering with Japan in the battery sector in the future. In its strategy, METI said it will expedite the integration of materials and manufacturing equipment in Japan based on production plans of battery makers and automakers.
Going forward, Japanese battery materials makers are likely to concentrate on selling battery materials to Japanese companies and countries in their supply chain. This is likely to hurt Korean secondary battery companies highly dependent on Japan for anode materials, cathode materials, pouches, and electrolytes. In light of this fact, Korea will need to pump up its efforts to localize the four core battery materials.
Meanwhile, the Korean Ministry of Trade, Industry and Energy announced a national strategy to boost the Korean secondary battery industry’s competitiveness in May. According to the strategy, the Korean ministry will zero in on sharpening Korean companies’ competitiveness in materials, parts, and equipment for batteries by more than quadrupling Korea’s production capacity of secondary battery cathode materials and more than tripling the amount of Korea’s equipment exports over the next five years.