South Korea’s top three battery makers are highly likely to see a surge both in sales and operating profits despite their reduced market share in the global electric vehicle battery market, which is dominated by Chinese rivals, according to market tracker SNE Research on Thursday.
REUTERS/Kim Hong-Ji/File photo Purchase Licensing Rights SEOUL, Dec 12 (Reuters) - Under pressure from clients eager to diversify away from China, South Korean makers of automotive batteries have pledged to develop a more affordable type of battery chemistry favoured by their Chinese rivals.
He also said that the Korean battery makers’ widening gap with the world’s No. 1 battery maker, CATL of China, is also likely to be reduced in the near future. By 2025, CATL’s revenue is expected to stand at about $25 billion won, which is equivalent to those of the three Korean rivals combined.
At present, none of the three major South Korean suppliers - which account for nearly half of global automotive battery supply excluding the Chinese market - make LFP automotive batteries. LGES does, however, manufacture other types of LFP batteries. All three firms have recently said they are accelerating LFP development.
Over the past year, the three South Korean battery firms have announced a combined $44 billion in investments to expand production capacity - mainly in the U.S. to qualify for subsidies.
Chung Wonsuk, an analyst at Hi Investment & Securities, estimates any Korean-made LFP batteries would likely be 17% more expensive than Chinese products and that could jump to 40% if the batteries were produced in the U.S. due to higher labour and infrastructure costs.