Chery Batteries
LG Chem Ltd., South Korea's leading chemicals and batteries maker, announced on Sept. 24 that it will supply Chery Automobile Co. with batteries for its next-gen electric vehicles (EVs), the mass production of which is scheduled to start from the end of this year. Accordingly, it will add hundreds of billions of won to sales. Chery Automobile is a Chinese automobile manufacturing company headquartered in Wuhu, Anhui Province, China. It was founded by the Government of China in 1997, and is a state-owned corporation.
With the latest deal, LG Chem will be able to win additional orders in the future, as the two companies have agreed to strengthen mutual cooperation.
Also, the company has captured more than half of China’s top 10 carmakers, including joint ventures and local brands, gaining the initiative in the world’s largest EV market.
LG Chem’s big name customers in China include Shanghai Automotive Industry Corporation, Dongfeng Motor Corp., and the First Automotive Work Group Corporation. They are ranked in the top three.
The Chinese government has recently geared up for a policy called “New Energy Autos” to make eco-friendly cars more widely available by establishing charging facilities across major cities. It aims to replace more than 30 percent of new cars for governments and public agencies with EV models and other eco-friendly cars by 2016. Earlier, the government pushed the policy only in China’s major trial cities like Beijing and Shanghai. But now, it has expanded the area of policy applications to the whole country and is making active efforts to get people to buy EVs. According to HIS, a global market research company, the number of non-fossil fuel cars in China will increase to 110,000 units by the end of this year, and to 655,000 units in 2020.
As China is expected to emerge as the world’s largest EV market, LG Chem has been seeking to expand its EV battery business in the Chinese market. Accordingly, the company is building a plant to produce EV batteries in Nanjing, China, with an annual capacity of 100,000 units. The operation is scheduled to start next year.