Korean Economy News
SK Innovation to sign $1.67 bn MOU to build EV battery plant in Georgia

Lee Jae-cheol and Cho Jeehyun

South Korea’s SK Innovation Co. which recently joined Volkswagen Group’s ambitious campaign to deliver 50 new full-electric models by 2025 is building a $1.67 billion battery plant in Georgia, the United States, to meet its share for the United States.

SK Innovation CEO Kim Jun on Friday in local time will sign a memorandum of understanding with Georgia Governor Nathan Deal on project to construct 9.8 gigawatte hours (GWh) EV battery manufacturing plant by 2022 in Commerce, Georgia.

The investment will be made in two phases, beginning in the first half of this year. During the first phase, the Korean lithium-ion battery maker will invest $1 billion, as approved by the company’s board of directors in November last year.

SK Innovation will invest the remaining $67 million for a second-phase expansion by 2025. Once completed, the company is expected to become the largest Korean EV battery producer in North America based on production capacity.

Last year, the company was selected as a strategic supplier of EV battery cells for European and North American markets by Volkswagen Group. SK’s new factory is located only 240 kilometers (150 miles) away from U.S production base in Tennessee.

Korean makers have been aggressive to make headway in EV race. Last year, LG Chem announced plans to invest 651.3 billion won ($578.6 million) in its wholly-owned subsidiary in Poland to expand production facility of electric car batteries, while Samsung SDI decided to inject $62 million to add its automotive battery pack manufacturing facility in Michigan, the U.S.

SK Innovation leapfrogged among battery makers this year with shipments jumping 135 percent on year in January-July period, doubling the average growth of 55 percent in the big league. SK which had lagged behind bigger local rivals LG Chem and Samsung SDI has added 4.7GWh plant in Seosan, Korea, and is building plants of 7.5GWh capacity in Hungry and another 7.5GWh capacity in China.

On Friday, SK Innovation shares gained 1.8 percent to close at 169,500 won.

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