SEOUL, Oct. 7 (Korea Bizwire) — SK Innovation Co., South Korea’s largest refiner by sales, said Sunday that it will invest 400 billion won (US$353.8 million) to build a lithium-Ion battery separator plant in China.
The company said it plans to break ground early next year for the plant that will make lithium-ion battery separator (LiBS) and ceramic coated separator (CCS) in Changzhou in China’s southeastern Jiangsu province.
The separators are key components of high capacity electric vehicle power packs that drive electric cars.
The plant is set to start commercial production in the third quarter of 2020 with an annual capacity of 340 million square meters of LiBS and 130 million square meters of CCS, SK Innovation said.
The plant — the first overseas project for SK Innovation’s material business — will boost SK Innovation’s total lithium-ion battery separator production volume to 850 million square meters per year.
SK Innovation said it will supply all the separators to be produced to battery manufacturers for EV and information and technology appliances.
“This investment will help us build a springboard to become the world’s biggest in terms of wet separator market share, a notch up from the current position as the world’s second largest,” SK Innovation CEO Jun Kim said. “We will also continue to work with China as the world’s premiere technology developer.”
SK Innovation set up SK hi-tech battery materials Co.in China, its wholly owned subsidiary, to finance the investment in the country.
The Chinese EV market has considerable growth potential as Beijing is pushing to expand production of environmentally friendly vehicles to reduce pollution.
SK Innovation is South Korea’s top oil refiner, but it has moved into the electric vehicle battery business since 2008 as part of efforts to find new revenue sources.
Currently, SK Innovation supplies batteries to South Korea’s largest carmaker, Hyundai Motor Co., and its smaller affiliate, Kia Motors Corp.
The electric vehicle battery market has been on the rise as automakers race to go electric due to tightened regulations on greenhouse gas emissions, which scientists say are to blame for global warming.