SEOUL, Oct. 23 (Korea Bizwire) — LG Chem Ltd. said Tuesday that it will invest 2.1 trillion won (US$1.8 billion) by 2023 to build electric vehicle batteries in China in the latest move to meet growing demand for batteries for zero-emissions cars.
South Korea’s top chemical company said it has broken ground for a three-story plant on the 198,300-square-meter site — about 24 times the size of a football pitch — in Nanjing in southeastern China.
The plant is set to roll out electric vehicle batteries that can power more than 500,000 electric vehicles. The first phase of production is set to begin late next year.
An electric vehicle equipped with LG Chem batteries can travel about 320 kilometers on a single charge, according to LG Chem.
LG Chem Vice Chairman and CEO Park Jin-soo said the second plant in China will allow the company to better meet rapidly growing global demand.
LG Chem has another electric vehicle battery plant in Nanjing. It also operates electric vehicle battery plants in South Korea, the United States and Poland.
The electric vehicle battery market has been on the rise as automakers around the world race to go electric due to tightened regulations on greenhouse gas emissions, which scientists say are to blame for global warming.
Currently, LG Chem is a key supplier of batteries to U.S. auto giant General Motors, Volvo and Renault, as well as South Korea’s largest carmaker, Hyundai Motor Co., and its smaller affiliate, Kia Motors Corp.
Shares in LG Chem fell 2.52 percent to 329,000 won (US$289). The broader KOSPI shed 2.57 percent.
LG Chem declined in line with the KOSPI’s loss, though the firm’s output capacity expansion plan didn’t affect the shares, Lee Ji-yeon, an analyst at Shinyoung Securities Co., said.