Diversifying Electric Vehicle Suppliers
As EV adoption accelerates, more automakers are investing in their own battery factories to diversify their supply chains. This will help them reduce their dependence on suppliers in countries with volatile mining and labor practices.
EV manufacturers assemble battery cells into modules and then packs, which are sent to automakers who place them in EVs. To ensure a high-quality product, these companies are focusing on sustainable production.
SK On
The SK On brand was launched in October 2021 after South Korea’s energy giant SK Innovation split off its battery business unit. Its goal is to become a global leader in the electric vehicle industry with a wide range of technologies and manufacturing expertise. SK On’s first plant is located in Commerce, Georgia, and serves two global OEMs. It is expanding its production capacity globally.
SK On is also developing new chemistries and batteries. Its NCM-811 battery, developed for Hyundai Group’s electric vehicles, has a driving range of up to 400 kilometers on a single charge. In addition to EVs, SK On is expanding its use electric vehicle supplier of NCM-811 cells in mobile devices, consumer electronics, and power storage applications.
In North America, SK On will supply lithium-ion batteries for the next generation of Ford F-Series pickup trucks and SUVs. It is building its third factory in Seosan, which will increase production capacity to 14 gigawatt-hours by 2028. This will allow it to meet the U.S. EV battery requirement of sourcing at least a certain percentage of critical materials from the United States or a free-trade partner to qualify for new EV tax credits.
SK On’s latest EV batteries are made of lithium-ion polymer (LFP) cells, which have a lower cost and shorter charging time than high-nickel NCM batteries. The company recently unveiled the prismatic LFP cell that can charge from 10% to 80% in just 18 minutes. This was shown in the InterBattery 2023 exhibition hall and caught a lot of attention from visitors.
BYD
BYD is one of the leading electric vehicle brands globally and has a strong reputation for battery technology, which it has used to power vehicles worldwide. However, the company faces several challenges, including limited brand recognition outside of China, a small product lineup, and financial volatility. These weaknesses make it challenging for the company to compete with its rivals in the global EV market.
The company began making rechargeable batteries for mobile phones in the early 1990s and then shifted into building electric cars in 2003. Its founder, Wang Chuanfu, hoped to take advantage of the expected switch from gas-powered vehicles to electric ones. His gamble paid off, and BYD now makes both personal EVs and larger vehicles such as buses and monorails.
In some markets, like Europe, the company has chosen to partner with established automakers to build and sell its products. This strategy helps it avoid the high start-up costs of a pure-play automaker and allows it to scale quickly. But it also limits the number of potential customers the company can reach and could lead to lower profit margins than competing with a major player.
In the United States, BYD is staking its future on a large expansion of dealerships and charging infrastructure. But it remains a niche player in the country, where it faces political tensions between Washington and Beijing over security, technology, and human rights.
LG Chem
LG Chem, the largest chemical company in Korea, produces petrochemicals for various industries and is developing lithium-ion batteries. It has set ambitious targets for carbon-neutral growth and is working on new business plans to reduce energy costs by incorporating renewables. It is also pursuing environmental lifecycle assessments (LCAs) of all products. It is the first company in the industry to establish an internal carbon management system.
The company is a major producer of acrylonitrile butadiene styrene (ABS) and styrene-acrylonitrile resin (SAN). It also manufactures polyvinyl chloride (PVC), ethylene, propylene, butane, benzene and polarizers for LCD photoresist and OLED materials. Its ethylene vinyl acetate (EVA) copolymer is used in a electric car manufacturer wide range of value-added products such as plastic sheets for photovoltaic solar cells, shoe soles and life vests.
In addition to battery materials, LG Chem is also boosting its profitability by focusing on innovative drugs. It is expanding its portfolio of FDA-approved pharmaceuticals and accelerating the commercialization of oncology drugs. Its new drug development efforts are focused on metabolic diseases and anti-cancer therapeutics.
Samsung
Samsung’s EV battery business will showcase its latest battery solutions for electric vehicles at IAA MOBILITY 2023. The company will display all-solid-state, 46-phi cylindrical nickel manganese (NMX) and lithium manganese iron phosphate (LMFP) batteries that offer the ideal balance of performance and cost. These batteries are designed to last 200,000 miles and feature cobalt-free design to reduce the impact on global resources.
During the event, Samsung will also demonstrate new in-car sensor technologies primed for driver and occupant monitoring systems. These include in-vehicle displays that can alert drivers to drowsiness and other factors that could compromise safety. In addition, the company will showcase LED lighting technologies that leverage 5G to improve communication with pedestrians and other vehicles.
Stellantis and Samsung SDI announced this week that they would build a second joint venture plant in the US to produce EV batteries. This project is slated to begin production in 2025 and will be located in Kokomo, Indiana. The companies will invest more than $2.5 billion in the facility, and it is expected to create 1,400 jobs. The Kokomo plant will have an initial annual production capacity of 23 gigawatt hours (GWh).
