Heads of Hyundai Motor and LG Groups Hold Talks
Hyundai Motor Group senior vice chairman Chung Eui-sun and LG Group chairman Koo Kwang-mo met at LG Chem's Ochang plant in Cheongju, North Chungcheong Province, on June 22, and exchanged opinions on future electric vehicle (EV) batteries.
The Ochang plant is a future production base for LG Chem, the world's top battery maker. The two leaders were accompanied by many CEOs, including Albert Biermann, president of Hyundai-Kia R&D headquarters; Kim Gul, president of Hyundai Motor Group's Planning And Coordination Office; Park Jung-kook, president of Hyundai Mobis; Kwon Young-soo, vice chairman of LG Corp.; and Shin Hak-chul, vice chairman of LG Chem.
Analysts say that the meeting between the heads of Korea's leading automotive group and the No. 1 EV battery company may pave the way for an EV alliance.
Currently, the global auto industry is fiercely competing for the EV market, which is entering a fast-growth phase. Environmental regulations on internal combustion engine vehicles and electrification in the mobility market are highlighting the importance of the EV market. With Hyundai and Kia competing with Tesla and Volkswagen in the automotive industry and LG Chem facing competition with China's CATL or Japan's Panasonic in the battery industry, the meeting between the two heads is interpreted as a move designed to strengthen an electric vehicle and battery alliance.
In particular, the meeting focused on sharing future plans and directions. Hyundai Motor Group has been collaborating with LG Chem. For instance, it has selected LG Chem as a battery supplier for the E-GMP, its EV-only platform that will start mass production of vehicles in 2022.
For Hyundai Motor, enhancing the performance and price competitiveness of EV batteries is considered the main key to securing leadership in the market as global charging infrastructure remains underdeveloped. That's why Tesla, the No. 1 electric car seller, is working with China's CATL to produce batteries.
As it is a newly emerging market, competition is heating up to take the lead in technology. If a company gains the upper hand and widens gaps with other companies in mileage, charging time, and price competitiveness, it may be difficult for the other companies to catch up with the leader. If Hyundai Motor Group and LG Chem cooperate and share their capabilities rather than conducting R&D separately, they will be able to control the global EV market.
"This visit is aimed at examining the development status of next-generation high-performance batteries for electric vehicle models and sharing the direction of development for batteries for the future," said an official of Hyundai Motor Group. "We are speeding up the development of technologies that will become 'game changers' in the future battery field such as long-life batteries, lithium-sulfur batteries, and all-state batteries," said an official of LG Group. "We expect cooperation between the two groups."
A long-life battery is a battery that can be used more than five times longer than current batteries. Lithium-sulfur batteries have more than twice energy density per weight than current lithium-ion products, making them last longer and more price-competitive. An all-solid battery, called a "dream battery," improves safety by changing internal liquid electrolyte into solid.
Chung is expected to meet with chairman Chey Tae-won of SK Group before long to discuss the battery business. If a meeting with Chey takes place after meetings with Samsung vice chairman Lee Jae-yong and LG chairman Koo, a battery alliance among the four major conglomerates, led by Hyundai Motor Group, will become a reality. Currently, Hyundai Motor Group is receiving electric vehicle batteries from SK Innovation as well as LG Chem.