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<\/a><\/p>\nBy Heekyong Yang<\/p>\n
SEOUL (Reuters) -The South Korean government and its top battery companies plan to jointly invest 20 trillion won ($15.1 billion) through 2030 to develop advanced battery technologies, including solid-state batteries, the industry ministry said on Thursday.<\/p>\n
“The joint investment will allow South Korea to start commercial production of solid state batteries ahead of others,” the ministry said in a statement.<\/p>\n
South Korea is home to three of the world’s five biggest electric vehicle (EV) battery makers –LG Energy Solution Ltd (LGES), Samsung SDI Co Ltd and SK On. <\/p>\n
The trio collectively control more than a quarter of the global EV battery market and supply major automakers including Tesla Inc, Volkswagen AG, General Motors Co and Ford Motor Co. <\/p>\n
The ministry said the three battery firms will build pilot production plants in South Korea that will serve as their product and manufacturing innovation centres.<\/p>\n
The plants will be used to test and manufacture advanced products such as solid state batteries, cylindrical 4680 cell batteries and cobalt-free batteries before launching mass production from their overseas production sites.<\/p>\n
EV battery makers are racing to develop new battery technologies that promise longer driving range, higher energy density and better safety than the conventional lithium-ion batteries.<\/p>\n
Chinese battery giant CATL unveiled on Wednesday a condensed matter battery that it hopes to start mass production of later this year to power EVs.<\/p>\n
The world’s top battery maker said last month it was finding it difficult to come up with a technologically feasible and competitive product based on solid state batteries, a technology that is also being researched by Japan’s Toyota Motor Corp and Germany’s Volkswagen.<\/p>\n
The industry ministry said South Korea aimed to quadruple domestic production capacity of cathode materials and triple exports of battery production-related equipment with the investment. <\/p>\n
The plan comes after the government earlier this month announced a 7 trillion won financial support plan for domestic battery makers seeking to invest in infrastructure in North America to help them cope with the U.S. Inflation Reduction Act. <\/p>\n
Earlier this month, the U.S. Treasury Department unveiled stricter EV tax rules, aimed at weaning the United States off dependence on China for EV supply chains. <\/p>\n
The U.S. Inflation Reduction Act requires 50% of the value of battery components to be produced or assembled in North America to qualify for a $3,750 credit and 40% of the value of critical minerals sourced from the United States or a free trade partner also for a $3,750 credit.<\/p>\n
Under the latest rules, 16 EV models are now eligible for a full or partial tax credit, based on new thresholds that require a certain percentage of the battery parts and minerals to come from a qualifying country.<\/p>\n
Nearly 80% of EVs that are eligible for U.S. federal tax credits use batteries from South Korea’s three major cell makers, according to an analysis from brokerage Korea Investment & Securities. <\/p>\n
($1 = 1,328.3900 won)<\/p>\n
(Reporting by Heekyong Yang; Editing by Miyoung Kim and Kim Coghill)<\/p>\n
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