The global electric vehicle (EV) sales are expected to surpass 1 million units this year. In a bid to dominate the rapidly growing EV battery market, South Korean battery manufacturers are seeking to lower battery prices through the development of new materials and mass production. When the price of batteries goes down, leading to a lower price of EVs, it is expected to usher in the era of environmentally friendly cars will come sooner or later.
According to industry sources on December 26, domestic battery producers, such as Samsung SDI and LG Chem, are considering plans to install small nickel cobalt aluminum oxide (NCA) batteries, which are generally used in electric tools, in EVs.
An official from the industry said, “We can’t say that NCA material delivers a higher performance than nickel cobalt manganese (NCM), the most common material used today, by making a simple parallel comparison. However, the NCA battery has already verified its ability in the market as Panasonic supplied it to Tesla. We will flexibly respond to it depending on the fluctuations in material prices.”
The industry believes that the fall in the recently soaring aluminum prices will affect the release of new products as most battery manufacturers already have both NCM and NCA technologies.
According to the Korea Resources Corporation, the price of manganese per ton dropped from US$2,700 (2.91 million won) at the end of last year to US$1,780 (1.92 million won) as of the 22nd. On the other hand, the price of aluminum per ton rose from US$1,713.5 (1.84 million won) to US$2,137 (2.3 million won) over the same period. Considering the fact that manganese is a scare metal, however, the price reversal between manganese and aluminum will wear off soon.
LG Chem and SK Innovation are also preparing to launch the new NCM 811 battery cells which has a nickel-cobalt-manganese ratio of 8:1:1 instead of the current 6:2:2. It is the product that delivers a better performance by increasing the ratio of nickel, which determines the battery output, and strengthening the safety of separators with other materials instead.
In addition, domestic battery companies are also developing the mass production technology of solid state battery, which is considered a next-generation battery.
They are seeking to develop various technologies because the EV market is gradually evolving into the economy of scale. According to market research firm Inside EVs, the cumulative sales of EVs, including plug-in hybrid EV (PHEV), came to 893,370 units as of the end of October this year, surpassing 776,497 units of the total sales last year. When this trend continues, the figure will exceed 1 million units this year. In particular, 490,000 units of EVs were sold in China during the same period, up 45.4 percent from a year earlier.
In addition, major countries and automakers are aggressively expanding the mass production of eco-friendly cars. Accordingly, the market will grow at a faster pace. Toyota announced to use the electric driving device in all cars by 2025, while major countries, including the U.K. France and Germany, are presenting their plans to stop selling internal combustion engine locomotives.
In addition, automobile producers are putting pressure to lower the price of EV batteries. General Motors (GM) CEO Mary Barra said, “We will lower the price of batteries from US$145 (155,948 won) per kWh to below US$100 (107,550 won).” GM is currently being supplied with EV batteries from LG Chem.
Meanwhile, major domestic battery producers are trying to secure the price competitiveness through the aggressive expansion and mass production as well as the new material development. SK Innovation announced last month to make an 840.2 billion won (US$781.22 million) investment to establish a battery plant in Hungary. Samsung SDI and LG Chem are also planning to mass produce EV batteries in their new plants in Europe.