The domestic copper foil industry is strategically increasing investments in North America and Europe, aiming to gain a competitive advantage over China, which is launching a low-cost offensive in the medium to long term.
As of Feb. 7, industry sources indicate that Lotte Advanced Materials plans to accelerate the construction of a smart factory in Spain with an annual capacity of 30,000 tons as part of its global capacity expansion efforts. The company also aims to finalize the selection of a site and scale for a new manufacturing subsidiary in the United States by the end of the year and secure incentives early. The profitability of the domestic copper foil industry has been weak recently due to a slowdown in the electric vehicle market and an oversupply from China, leading to price reductions. With Chinese companies enhancing their technology and aggressively expanding, domestic firms are finding it increasingly difficult to compete. While each company has its own specific strategies, the overall plan is to improve quality and target the North American and European markets.
The industry is confident that it can enjoy various policy benefits in these regions, such as the Inflation Reduction Act (IRA), and that it has a more advantageous position for expansion compared to Chinese companies. Notably, the United States applies a high tariff of over 20% on Chinese goods. SKC is constructing a copper foil manufacturing plant in Poland with an annual capacity of 57,000 tons, aiming for completion this year. The company started its first shipment from a Malaysian plant in October last year and is pursuing expansion into North America following Malaysia and Poland. Last year, SK nexilis signed a memorandum of understanding (MOU) with Toyota Tsusho, a trading affiliate of the Toyota Group, to explore the establishment of a joint venture for producing and supplying copper foil in North America.
Solus Advanced Materials commenced construction of its first copper foil factory in Canada in September last year. This marks the company’s third overseas production base, following Luxembourg and Hungary, with plans to start mass production in 2025 and achieve a capacity of 25,000 tons by 2026. The company also plans to build two additional factories on the same site, ultimately expanding its production capacity to up to 63,000 tons per year. The domestic copper foil industry expects the market conditions to gradually improve in the second half of this year, resolving the price uncertainty caused by Chinese companies. With the rebound of the electric vehicle market due to new car launches and the effect of interest rate cuts, the demand for high-quality copper foil is also expected to increase.