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South Korea and China May Further Cooperate in Battery Industry
Korean Battery Makers Seeking to Reduce Reliance on Japan
South Korea and China May Further Cooperate in Battery Industry
  • By Jung Min-hee
  • August 22, 2019, 11:48
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Chinese battery material and component suppliers are looking to work more closely with South Korean battery manufacturers.

Multiple battery material and component suppliers in China are considering working more closely with South Korean battery manufacturers, which are trying to reduce their dependence on Japanese materials and components. Chinese news outlets recently reported that those Chinese companies can benefit from the ongoing trade disputes between South Korea and Japan that triggered the efforts for dependence reduction.

Chinese battery companies are already competitive enough in terms of price, technology and scale alike based on China’s solid battery industry value chain. In addition, they already own a lot of major battery materials such as cobalt, which means they are capable of overwhelming the others in cost competitiveness once they reach a certain level of technological strength.

China has tried to keep South Korea in check by, for example, not providing subsidies for automobiles equipped with batteries manufactured by South Korean companies. However, things are showing some signs of change these days and some Chinese companies are considering setting up joint ventures with them.

A number of South Korean companies are still cautious about replacing Japanese materials and components with Chinese and this has to do with quality issues and so on. However, not a few of them are examining the option as Japan’s export curbs can be expanded at any time as seen in the case of the semiconductor industry. “It is true that China’s battery industry is very solid and China is home to a large number of battery companies,” said an industry insider, adding, “Immediate replacement is unlikely though.”