SK Innovation to build new EV battery factorySK Innovation is building a new electric car battery facility in China by investing roughly 5 billion yuan ($726 million) together with its Chinese joint venture partners BAIC Motor and Beijing Electronics.
According to the Korean company on Friday, it is the first time a non-Chinese battery maker has set up a battery facility in China as a joint venture involving a Chinese carmaker.
The three companies will jointly invest about 5 billion yuan into building the plant by 2020. However, the Korean battery maker did not disclose how much each company is investing.
The new plant will be placed on a roughly 300,000-square-meter (74-acre) site in Jiangsu Province, an eastern-central coastal province of China, with 7.5 gigawatt-hour (GWh) output capacity. The capacity is enough to power 250,000 electric cars equipped with 30 kilowatt-hour batteries, according to SK.
Construction is scheduled to be completed by the second half of next year, but commercial operations will begin from 2020 after some test operations.
As the Korean company is also building up another 7.5GWh battery plant in Hungary, with construction due to be completed in 2022, it is expecting annual production capacity of its battery plants to add up to 20GWh by 2022, including its 4.7GWh domestic facility in Seosan, South Chungcheong.
“We are reaching out to build factories in key global markets for battery sales, like Europe and China, to bolster our business competency,” said Kim Jun, CEO of SK Innovation. “We are mulling various partnerships so that SK Innovation grows along with China’s electric car industry.”
As the Korean battery maker had set up a battery making joint venture dubbed BESK with the two Chinese companies back in 2013, the new plant will be operated as a wholly owned subsidiary of BESK.
The company said teaming up with Chinese companies in production is in line with its so-called China Insider strategy. SK Chairman Chey Tae-won has emphasized that it is important to become an actual insider when doing business in China through localization so that Chinese consumers and authorities view SK as a local company.
BY KIM JEE-HEE [email@example.com]