South Korean battery maker Samsung SDI will likely build the country's first LFP battery plant in its Ulsan production base, according to local media reports. However, as CATL and other leading China-based battery companies launch their next-generation products, South Korean manufacturers have faced more challenges entering the LFP battery market.
Business Korea reported that industry and government sources said Samsung SDI is discussing with the Ulsan City Government a plan to produce LFP batteries in the area. The company will set up its first LFP battery factory in South Korea if the plan comes through.
Sources from Samsung SDI told Business Korea that the company has yet to decide whether it will make LFP batteries for EVs or energy storage systems (ESS). It will take more time to finalize the investment.
Ulsan is the designated special cluster for national advanced strategic industries focusing on rechargeable batteries. Therefore, Samsung SDI has been actively planning to expand its local production base. The company primarily makes batteries for EVs and ESSs with a production capacity of 10GWh.
South Korean industry sources said demand for the cost-competitive LFP batteries is spiking thanks to the ongoing EV price war and the increasing renewable energy market. Chinese battery makers like CATL have seen their market share increase. South Korea-based LG Energy Solutions, Samsung SDI and SK On also have accelerated LFP battery development because they realize they will need products other than high-nickel ternary batteries to rival Chinese competitors in the long term.
LGES plans to start mass-producing LFP batteries for ESSs within 2023, while SK On unveiled an LFP prototype for EVs in March. Samsung SDI, which depends on its high-added-value products, also said it will expand its LFP portfolio.
Simultaneously, China-based companies are introducing new technologies to the market to maintain their leading position in LFP battery expertise.
For example, CATL just announced Shenxing, an LFP battery enabling superfast charging. The company claimed the battery can support a driving range of 400km with a 10-minute charge. If the next-generation battery is commercialized in the first quarter of 2024 as expected, it will set a much higher technical bar for South Korean battery makers who are late to the LFP segment.
