By Heekyong Yang
SEOUL (Reuters) – South Korean EV battery maker SK On is in talks with automakers to provide prismatic batteries, increasing from its present pouch-type batteries, a senior government mentioned, because it scrambles to show round amid slowing world electrical automobile (EV) demand.
SK On, a unit of power group SK Innovation, which provides EV batteries to Ford Motor (NYSE:), Hyundai Motor (OTC:), Volkswagen (ETR:) amongst others, is talking to a number of automakers that need to line up prismatic battery provide offers, SK On chief spokesperson Ko Chang-Kook mentioned.
“We’re having talks with automakers who will take our prismatic batteries … we are going to now have the chance to diversify our product portfolios earlier than later,” Ko instructed Reuters.
Ko didn’t disclose the names of automakers however mentioned the corporate has already accomplished the prismatic battery expertise and is ready to start out producing prismatic batteries as soon as discussions are finalized.
There are three varieties of lithium-ion batteries at present utilized in EVs – prismatic, cylindrical and pouch-type, all of that are basically the identical in performance, however every has execs and cons.
Prismatic and cylindrical batteries are cased in onerous supplies. Pouch-types use sealed versatile foils and are protected by skinny steel luggage. SK On at present produces solely pouch-type batteries for EVs.
Whereas the agency secured prismatic battery expertise, additionally it is trying to develop cylindrical-type batteries, broadly recognized for the sort utilized by Tesla (NASDAQ:).
When requested if SK On, which has by no means made a revenue because it was break up off from SK Innovation in late 2021, plans to chop its capital expenditure for the 12 months, Ko mentioned SK On just isn’t contemplating that for now, including it is not going to reduce analysis and growth spending.
Earlier this 12 months, SK On’s father or mother SK Innovation mentioned it had a capital spending price range of about 9 trillion received ($6.55 billion) for this 12 months, with greater than 80% allotted for SK On.
Cross-town rival LG Power Answer (LGES) mentioned in April it plans to minimise capital expenditure this 12 months on account of slowing EV demand. Final month, LGES paused a part of building of its multi-billion greenback battery manufacturing unit within the U.S. state of Arizona because it adjusts the tempo of deliberate funding execution flexibly to optimize its operations.
In April, SK On mentioned it was nonetheless on the right track to interrupt even within the second half of this 12 months. The corporate mentioned this month it could implement across-the-board expense cuts, together with freezing salaries of all executives till the agency turns a revenue.
SK Innovation is predicted to pursue a merger with worthwhile fuel affiliate SK E&S to assist prop up SK On, native media shops have reported.
On Friday, SK Innovation mentioned in a regulatory submitting that it could maintain a board meting subsequent Wednesday to debate varied strategic measures, together with mergers to strengthen its competitiveness, however nothing has been determined.
($1 = 1,374.4200 received)
