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Three Korean Battery Manufacturers to Domestically Invest About 2.6 Trillion Won
Amid Chinese Retaliation
Three Korean Battery Manufacturers to Domestically Invest About 2.6 Trillion Won
  • By Jung Min-hee
  • September 11, 2017, 01:45
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Baek Woon-kyu (third from the right), minister of trade, industry and energy (right), is posing with representatives of the Korean secondary cell industry in a meeting held at the Palace Hotel in Seoul on September 8.
Baek Woon-kyu (third from the right), minister of trade, industry and energy (right), is posing with representatives of the Korean secondary cell industry in a meeting held at the Palace Hotel in Seoul on September 8.

 

Three Korean battery manufacturers -- LG Chem, Samsung SDI, and SK Innovation -- decided to invest about 2.6 trillion won in Korea by 2020. The government will take the lead in solving the companies’ difficulties in order to help the Korean secondary battery industry preempt the world market.

The Ministry of Trade, Industry and Energy (MOCIE) held a meeting with the secondary battery industry at Sheraton Seoul Palace Hotel on September 8 to listen to the troubles of the industry and discuss ways for investments and win-win cooperation to strengthen industrial competitiveness. The meeting was presided over by Baek Woon-kyu, minister of trade, industry and energy and attended by representatives of battery companies and companies of secondary cell materials and equipment including Lee Woong-bum, president of LG Chem, Jeon Yeong-hyun, president of Samsung SDI and Yun Ye-seon, head of the battery business at SK Innovation.

In the meeting, the three companies said they were planning to invest about 610 billion won in technology development such as the innovation and upgrading of the performance of secondary batteries for electric cars by 2020. In order to preemptively expand the market of electric vehicles and energy storage systems (ESSs), they will invest 2 trillion won in the expansion of production capacities and the construction of new facilities in Ochang (LG Chem), Ulsan (Samsung SDI) and Seosan (SK Innovation), they added.

Companies that attended the meeting said that they are having difficulties due to the Chinese government’s sanctions on Korean-made batteries for electric cars. The Chinese government has excluded electric vehicles loaded with Korean batteries from a list of electric cars that can receive subsidies since December 29 of last year. In China, electric vehicle subsidies are about half of prices of cars, so if electric cars cannot receive subsidies, it will become very difficult to sell them in China.

The government has tried to solve problems by contacting China in various channels but has not addressed them yet. Some argue that such sanctions are part of China’s retaliations against the South Korean government's deployment of the THAAD System.

Participants also appealed to the government to expand support for them such as tackling a surge in prices of raw materials for secondary batteries including cobalt and strengthening the competitiveness of material and equipment makers.