South Korea’s three major battery makers poured over 4 trillion won ($2.84 billion) into plant construction and equipment upgrades in the first half of the year, keeping their capital spending steady even as the slowdown in electric vehicle demand drags on.
In their first-half business reports, LG Energy Solution, Samsung SDI and SK On together spent about 4.32 trillion won on battery-related facilities. Much of the investment was allocated toward new production capacity, plant expansions and equipment upgrades.
LG Energy Solution led the pack with the largest investment, spending 2.69 trillion won on its battery business in the first half. Most of the amount went toward new and expanded facilities and manufacturing equipment, which the company said would boost its production capacity.
“We will continue to make appropriate investments in line with changes in the business environment and market conditions to strengthen our competitiveness,” the company said in the filing.
Meanwhile, Samsung SDI invested 1.08 trillion won in its Energy Solution division, which covers its battery business. Combined with the 11.9 billion won invested in electronic materials, the company’s total capital expenditure reached 1.09 trillion won in the first half.
SK On spent 578.9 billion won on new and expanded facilities in its battery businesses during the first half, including investments in battery production facilities in Korea and overseas and lithium-ion battery separator production lines.
The company said it will continue to expand investment to gain competitiveness in its battery business.
The battery makers' continued spending comes as battery makers actively pivot toward energy storage systems to cushion the impact of a prolonged slowdown in global EV demand.
Korean battery makers had aggressively expanded in North America by setting up joint ventures with automakers including General Motors, Ford and Stellantis to build EV battery plants in the US and Canada. More recently, however, several of those partnerships have been restructured, with battery makers ending joint ventures and taking sole control of some facilities.
Some plants in the US and Canada, originally designed primarily to supply EV batteries, are being converted to produce batteries for energy storage systems, a market where demand has been growing rapidly.
All three companies pointed to ESS as a key area for future growth. Samsung SDI and SK On also highlighted batteries for robots, while LG Energy Solution and Samsung SDI cited all-solid-state batteries as next-generation technologies or businesses.
By Ahn Sung-mi (sahn@heraldcorp.com)
