Fierce Competition with SK IET Expected
LG Chem will make a foray into the separator market, one of the key materials for electric vehicle batteries, by forging a partnership with Toray Industries of Japan.
LG Chem announced on Oct. 27 that it will establish LG Toray Hungary Battery Separator Kft in Hungary, a 50:50 joint venture with Toray Industries. They agreed that LG Chem will acquire an additional 20 percent stake in the company from Toray to secure its management right after 30 months. The two companies will invest more than 1 trillion won step by step. LG Chem said it will invest 642.7 billion won to acquire a 70 percent stake.
The factory will be established on the premises of a plant of Toray Industries Hungary Kft in Komarom-Esztergom, northwestern Hungary. The total area is 420,000 square meters, about 60 football fields combined.
At the plant, the two companies plan to expand their lines in the first half of next year and secure an annual production capacity of more than 800 million square meters by 2028. Mass-produced separators will be supplied to LG Energy Solution’s plant in Wroclaw, Poland.
LG Chem shares SRS technology with Toray, which significantly improves separators’ safety and performance by thinly coating their surfaces with ceramic materials, and operates coating production lines in Hangzhou of China, Brotswap of Wroclaw in Poland and Cheongju of Korea.
Both companies had patent disputes with SK Innovation in the past. SK Innovation developed separator production technology for the first time in Korea and the third time in the world in 2004 and launched related businesses. Toray, one of the world’s leading companies at the time, filed a patent infringement suit against SK Innovation with the Seoul Central District Court in 2006. The court ruled in favor of SK Innovation in 2009.
SK IET, a separator business affiliate of SK Group, ranks first in the world with a 26.5 percent share of the tier 1 wet separator market for global leading electric vehicle makers, according to SNE Research. SK IET’s Plant 1 in Poland, which was recently completed, has a separator production capacity of around 340 million square meters per year. The company plans to invest 2 trillion won by 2024 to boost its production capacity to 1.54 billion square meters in Europe alone. The joint product between LG Chem and Toray is also a wet separator, so fierce competition is expected between SK IET and LG Chem and Toray.