LG Energy Solution is said to have shifted its focus to 46-series battery cells, which are 46mm in diameter. Industry sources in South Korea said the battery maker is working on a project to produce 46-series cylindrical cells at its Nanjing plant in China.
Panasonic takes up the largest market share in the cylindrical battery market, followed by LGES. The market is expected to expand rapidly as demand for EVs continues to increase.
Industry sources told South Korea-based ET News that LGES is considering setting up production lines in Nanjing to make 46-series batteries. In October, LGES was said to adjust the production plan for its Arizona factory in the US from making 21700 cells to producing 46-series batteries.
It was reported that LGES planned to manufacture 46800 and other new-generation cylindrical batteries and operate its Nanjing plant as a production hub for 21700 cells. However, as the demand for 46-series cylindrical batteries surged, LGES did not expand the production of 21700 cells but planned to set up 46-series lines.
While LGES' Nanjing plant customers remain unknown, the industry suspected that the company targets Chinese automakers and likely supplies European carmakers.
Sources related to LGES said the company has not finalized the plan of making 46-series batteries in Nanjing, but it will satisfy customers' needs and diversify its product portfolio with flexible investment.
At the third-quarter earnings call this year, LGES said its Arizona plant, under construction, will be developed into the production hub of 46-series cylindrical batteries in North America.
Compared with the 21700 battery, the 46-series cell offers five times more capacity and six times more output power. The 46-series battery can increase driving range by 16% and reduce costs by 54%. The competition for commercializing the battery technology has intensified since Tesla announced the 46800 battery in 2020.
If LGES makes the 46-series batteries in Nanjing, the facility will form a production triangle with the company's factories in Arizona and Ochan, South Korea. In June 2022, LGES said it plans to invest KRW580 billion (US$440 million) in setting up 46800 battery production at one of its plants in Ochan. The facility will hold a capacity of 9GWh and supply Tesla.
LGES aims to begin mass production at the Arizona plant by the end of 2025. The production capacity of 46-series batteries will increase from 27GWh to 37GWh. The South Korean securities industry estimated that the EV-use cylindrical cell market will grow from 108GWh in 2022 to 241GWh in 2025 and 705GWh in 2030. The 46-series batteries are expected to dominate the cylindrical market.
