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LG Chem, Samsung SDI to build new battery plants in Europe amid growing demand for electric vehicles

2016.03.21 16:01:01 | 2016.03.21 17:31:52
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Both LG Chem Ltd. and Samsung SDI Co. - South Korea’s two leading battery makers - are planning to set up manufacturing bases in Europe to make inroads into the market most fast in incorporation of electric vehicles and carbon-free orientation.

According to multiple industry sources on Sunday, Samsung SDI has recently sent a group of working-level employees to Hungary to secure a new battery-making facility in the European country. The company is hoping to utilize its plasma display panel (PDP) manufacturing plant in Hungary that was built in 2001 and remains idle after the company stopped producing PDPs. It deems it could save cost by transforming the site into a battery factory.

Hungry is the home to many production facilities of major European automakers including Volkswagen, Mercedes-Benz, and BMW. Hungary is also very close to Austria where Magna Steyr, a global battery pack manufacturer Samsung SDI acquired last year, is based in.

Cho Nam-seong, Samsung SDI CEO, confirmed last week after the shareholders’ meeting on Mar. 11 that the company was examining several locations to build a battery factory in Europe.

South Korea’s No. 1 battery maker LG Chem is already in talks to buy an auxiliary site in Wroclaw, southwestern Poland, to build an electric battery plant in a compound that already houses production facilities of LG Display Co., LG Electronics Inc. and LG Innotek Co. Currently, the company has three electric vehicle battery production plants - each in Ochang, Korea; Michigan, the United States; and Nanjing, China.

LG Chem and Samsung SDI are increasingly focused on expanding their presence in the European market where the electric vehicle industry has been growing rapidly. European consumers are taking more notice of electric vehicles as an alternative to diesel cars especially after the Volkswagen emissions scandal that put the future of diesel cars in question.

Last year, sales of electric cars including hybrids, reached a record 23,463 units in Germany, a country that is considered the core of Europe’s auto industry. This sales volume is 79.8 percent increase from a year ago and accounts for 1 percent of new car sales. Another appeal is the offering of various incentives by European countries to promote proliferation of electric vehicles.

By Lee Seung-hoon

[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]

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