SK Innovation held a groundbreaking ceremony on Monday for a plant in Seosan, South Chungcheong Province that will produce batteries for electric vehicles.
Scheduled to be completed next year, the W250 billion facility will be able to produce batteries for some 25,000 electric vehicles per year (US$1=W1,080). They will be supplied to Hyundai Motor for its BlueOn subcompact, Mercedes-Benz for the SLS AMG E-Cell sports car and Mitsubishi Fuso for hybrid trucks.
SK faces stiff competition from LG Chem and SB LiMotive. LG completed a plant at the Ochang Industrial Complex in North Chungcheong Province in April capable of producing batteries for 100,000 EVs a year, rising to 350,000 a year by 2013. The company currently supplies batteries for GM’s Volt and the hybrid versions of the Hyundai Sonata and Kia K5, and has also signed deals with Ford, Renault and Volvo.
SB LiMotive, a joint venture between Samsung SDI and German auto parts maker Bosch, constructed a plant in Ulsan last November and supplies batteries to BMW for its ActiveE electric car.
“The EV battery business won’t be profitable immediately, but rather will develop into a major business area 10 to 15 years down the road as EVs become more common,” said Cho Seung-yeon, an analyst at HMC Investment Securities.
