Scaling up Business through Preemptive Investments
SK Innovation has made it into the global top 5 EV battery producers as of April 2020, the company said, citing a report released by research and consulting firm SNE Research on June 16.
Since its first time being in the top 10 last year, SK Innovation has been showing a fast, upward trend. It recorded 189.1 MWh in global EV battery usage this April, outperforming its domestic competitor, Samsung SDI (187.2 MWh) for the first time.
Industry officials comment that despite the contraction of the electric vehicle (EV) market caused by the prolonged COVID-19 pandemic, SK Innovation is still able to scale up its business through preemptive investments worldwide. Especially, the firm has outrun other Chinese competitors to become the EV battery supplier for Beijing Automotive Industry Holding Co.’s premium electric SUV model Arcfox Mark 5. The batteries that will be used for Mark 5 are said to be produced in BEST factory in Changzhou, China. BEST is SK Innovation’s manufacturing base for EV battery cells under a joint venture with Beijing Automotive Group and Beijing Electronics.
SK Innovation has been expanding its battery business as one of the major future growth engine by scaling up investments in not only Asia, including hometown Korea and the huge EV market China, but also in Europe and America. When the company’s second plant in Georgia, U.S., starts operating, SK Innovation will be able to increase its current total global production level of 19.7 GWh to 71 GWh by 2023. The company’s further goal is to be among the top 3 global players in the EV battery market by 2025 by producing 100 GWh in total annually.
Even in the statistics provided by SNE Research on the accumulated deployment of built-in batteries of electric vehicles (EVs, PHEVs, and HEVs) sold worldwide between January and April 2020, SK Innovation recorded 1.1 GWh, a 74.3 percent year-over-year increase, and climbed two steps to be the 7th largest EV battery manufacturer in the global rankings.
Meanwhile, according to SNE Research, the global EV battery usage was recorded at 5.4 GWh in April 2020, a 39.8 percent YOY decrease. The shrinking of the American and European markets triggered by COVID-19 and the prolonged market slump in China have been pointed out as the main causes behind the sharp decline. However, it is also predicted that the American and European market will gradually enter a recovery phase once the impacts of COVID-19 subside. This means EV battery makers worldwide will still stay in heated competition to keep up with the huge demand of EVs in the next few years.