SEOUL, Apr. 2 (Korea Bizwire) — SK Innovation Co., a major electric vehicle (EV) battery maker, has signed a deal to secure a key material used for high-capacity EV batteries, industry sources said Tuesday.
According to the sources, SK Innovation has signed the deal to secure lithium hydroxide from Tianqi Lithium Kwinana (TLK), in Australia, which is an affiliate of the China-based Tianqi Lithium, the world’s No. 3 producer of the metal used in EV batteries.
Under the deal, SK Innovation will be supplied an estimated 50,000 tons of lithium hydroxide starting from July 1, 2019, to 2024, according to the sources.
“The deal was actually signed in December,” an SK Innovation official said. “The deal will allow us to secure a stable supply of key EV battery material.”
Meanwhile, its larger local rival LG Chem Ltd. also signed a five-year deal in July last year with Nemaska Lithium, a Canadian supplier of lithium hydroxide, a key material in making electric vehicle batteries.
Last month, SK Innovation decided to spin off a unit that focuses on the development of information and electronic materials.
The new unit will be involved in developing key information and electronic materials, such as lithium-ion battery separators (LiBS).
SK Innovation has been increasing spending on the EV battery business in a bid to diversify its business portfolio.
South Korea’s top energy-chemical business group said in November it will invest 1.14 trillion won (US$1.01 billion) to build the 9.8 gigawatt-hour capacity battery plant in the city of Commerce in Jackson County, Georgia.
Thanks to the investment, the company will have EV battery plants in each of its four key markets — South Korea, China, Europe and the United States.
SK Innovation said it will strive to raise its EV battery output capacity to 60 GWh by 2022, from the current 4.7 GWh, by building more plants and expanding existing facilities.
The company provides lithium-ion batteries for EVs produced by Kia Motors and China’s state-run Beijing Automotive Industries Holdings.