LG lobbies U.S. lawmaker to undermine SK bid for veto

Home > Business > Industry

print dictionary print

LG lobbies U.S. lawmaker to undermine SK bid for veto

                          [YONHAP]

[YONHAP]

Any hope of LG Energy Solution and SK Innovation reaching a settlement that allows both companies to continue operating in the U.S. electric vehicle (EV) battery market seems to be fading fast, as LG looks to firmly shut the door on its long-term rival.
 
The wholly owned subsidiary of LG Chem sent a letter to U.S. Senator Raphael Warnock earlier this month, suggesting that it would build its own battery plant in Georgia. 

 
Georgia is where SK Innovation has promised $2.6 billion of investment and 2,600 permanent jobs with its own battery plants, currently under construction in Commerce, Georgia. That investment is also SK's best chance of persuading U.S. President Joe Biden to overturn a U.S. International Trade Commission (ITC) ruling last month that essentially bans the company from operating in the United States.
 
LG not only offered its own investment, but also seemingly suggested it could even take over the SK facilities. 
 
“[LG] is prepared to do whatever we can to help the people and workers of Georgia,” Kim Jong-hyun, CEO of LG Energy Solution was reported to have said in the letter to Warnock, according to the Atlanta Journal Constitution on March 13.
 
“Multiple investors and manufacturers... will be interested in the Commerce plant due to increased demand for electric vehicle batteries.”
 
LG Energy Solution on March 14 confirmed the existence of the letter.
 
“[The letter] was intended to clearly address the current situation that has been caused by SK’s misappropriation of our trade secrets and to address concerns about jobs in Georgia,” the Korean battery company said in a statement.
 
LG’s letter comes as the window for Biden to veto the ITC ruling closes less than a month away on April 11.
 
Warnock, a Georgia Democrat, had previously said the ITC ruling is a “severe punch in the gut” for Georgia’s employment plan and the current administration’s green initiative.
 
On March 12, Georgia Governor Brian Kemp for the second time sent a letter to the White House asking Biden to overturn the ITC ruling.  
 
“SK Innovation has told the state of Georgia the ITC ruling will make it impossible for the plant to be economically viable and, absent action taken by you to disapprove the ITC ruling, SK Innovation will be forced to shutter the Commerce facility,” the letter read.
 
“[Vetoing the ITC ruling will] prevent the ruling’s adverse impact on Georgia and the U.S. economy, and to preserve our nation’s ability to compete in the global race for clean energy cars and trucks.”
 
The ITC ruling on Feb. 10 banned SK Innovation from importing EV batteries and components to the United States for 10 years with a few exceptions for existing local clients including Ford and Volkswagen.
 
SK Innovation said that it is "simply impossible" for LG to acquire its EV battery plant and run it to make batteries for major auto companies. 
 
"LG's monopolization of the U.S. battery supply chain will only set the United States further back in its effort to catch up with China," the company spokesman said.
 
LG Energy Solution on March 12 pledged to invest 5 trillion won ($4.4 billion) in its U.S. battery business through 2025, promising to build at least two factories at unspecified locations. Georgia could be one of its candidates.  
 
The investment will add 70 gigawatt-hours (GWh) to its U.S. battery production capacity, on top of its existing factory in Michigan which has 5 GWh capacity.
 
Separately, LG Energy Solution is building a $2.3 billion battery facility in Ohio through a joint venture with General Motors (GM) with a plan for a second plant coming soon.
 
BY JIN EUN-SOO   [jin.eunsoo@joongang.co.kr]
Log in to Twitter or Facebook account to connect
with the Korea JoongAng Daily
help-image Social comment?
s
lock icon

To write comments, please log in to one of the accounts.

Standards Board Policy (0/250자)

What’s Popular Now