May 31, 2011 09:04
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 will face stiff competition from LG Chem and SB LiMotive. LG completed a plant at the Ochang Industrial Complex in North Chungcheong Province in April, which is capable of producing batteries for 100,000 EVs a year, and currently supplies batteries for GM's Volt and the hybrid versions of the Hyundai Sonata and Kia K5. As it has also signed deals with Ford, Renault and Volvo, the facility will be expanded to an annual production capacity of 350,000 EVs by 2013.
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 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.
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