SK Innovation to spend $727 mn for second EV battery plant in US

SK Innovation EV business

South Korea’s SK Innovation, a supplier for Volkswagen and Ford Motors, will spend $727 million to build its second electric vehicle (EV) battery plant in the United States, Reuters reported.

SK Innovation will start the construction of the plant with annual capacity of 11.7 gigawatt-hours of batteries in July in the southern state of Georgia with production aimed for 2023.

It will make a further investment in its second U.S. factory, bringing total spending to about $1.5 billion, a company representative told Reuters, without specifying a timeframe.

SK Innovation plans investment of 1.2 trillion won or $903 million in its first U.S. factory, with capacity of 9.8 GWh intended to serve Volkswagen’s EV base in neighbouring Tennessee, and production on track to begin in 2022.

SK Innovation, South Korea’s biggest oil refiner, has expanded into EV batteries, with factories in South Korea, China and Hungary.

SK Innovation is also involved in a legal battle in the United States with South Korean rival LG Chem. A win for LG Chem could stop SK Innovation from importing EV batteries and components.

This month, researcher Wood Mackenzie forecast a drop of 43 percent this year in global sales of electric vehicles (EV), to 1.3 million units, hit by the coronavirus outbreak, lower oil prices and consumers’ wait-and-see approach to purchases of new models.