Korean Companies Taking Lead in EV Battery Market
The only German factory that produces battery cells for electric cars is closing. Within little more than one year, the company Li-Tec in Saxon Kamenz, will cease manufacture of battery cells. The company is a subsidiary of the Daimler Group.
The Li-Tec factory will close December 2015 but will be retained as a research location; the majority of the 280 employees will be transferred to the Deutsche Accumotive—also a wholly owned Daimler subsidiary—which manufactures battery packs. Accumotive is currently expanding its production capacity to build systems for the next generation of the electric smart among others. Cells are slated to come from LG Chem.
“Nissan has purchased EV batteries from AESC since 2009, but will diversify the supply sources to LG Chem and many more,” Renault Nissan Alliance Chairman Carlos Ghosn said in September. It is said that AESC’s products are approximately 15 percent more expensive than those of LG Chem.
These decisions come about because it is difficult for a company to realize the economy of scale and achieve price competitiveness on its own in the eco-friendly vehicle market. Battery manufacturers that have produced small batteries for use in smartphones and the like have more advanced technological strength, too. It is in this context that Hyundai Motor Company, Kia Motors, and BMW have procured battery cells from external sources from the get go.
At present, LG Chem’s customers include not only Hyundai and Kia but also about 20 automakers such as GM and Ford. Samsung SDI has done business with about 10, including BMW, as well. SK Innovation, which started relatively late, has supplied batteries for Kia Motors’ Soul EV, and set up a joint venture in China with the Beijing Automotive Group. The EV battery market is estimated to grow to US$11.9 billion by 2018
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