'Successful' LG Chem Faces New Coronavirus-Induced 'Delivery Date War'

[Asia Economy Reporter Park So-yeon] Korean electric vehicle battery companies that have suspended operations at their factories in China due to the spread of the novel coronavirus (COVID-19) are struggling to meet delivery deadlines. In the electric vehicle battery market, which heavily depends on Korea, the suspension of LG Chem and SK Innovation's factories in China for more than a week is expected to worsen the shortage of electric vehicle battery supply.

According to the battery industry on the 7th, LG Chem's electric vehicle battery factory in Nanjing, Jiangsu Province, China, and SK Innovation's Changzhou factory have suspended operations until the 9th to prevent the spread of COVID-19, putting the global battery supply chain on alert.

LG Chem operated its Nanjing factory during the Chinese New Year holiday period (January 24 to February 2) to deliver electric vehicle batteries, but following repeated recommendations from the Chinese government to halt factory operations, the factory has been stopped since the 2nd. The Nanjing factory is a large-scale facility with a production capacity approaching 15GWh (enough for 200,000 electric vehicles) and is responsible for 20% of LG Chem's battery production. LG Chem currently supplies about 20 customers, making the supply schedule very tight.

In the case of SK Innovation, it suspended local factory operations earlier than LG Chem, starting from the 24th of last month. This means the factory has been halted for more than two weeks. The production capacity of this factory is 7.5GWh and is currently in the commissioning phase. According to the original plan, commissioning was to be completed in the first half of the year, and batteries were to be supplied to Chinese automakers, but prolonged suspension may disrupt these plans.

LG Chem and SK Innovation have recently received requests from clients to increase supply volumes, making the resumption of operations at their Chinese factories urgent. The industry understands that before the COVID-19 outbreak, customers such as Audi, Jaguar, and Daimler had only received about 70% of the batteries they ordered from LG Chem.

A battery industry official said, "Although CATL, the world's number one electric vehicle battery company, is far ahead in terms of sales scale, the industry analyzes that its technology level is about 85% of that of Korean battery companies," adding, "As a result, global automakers are focusing their attention on Korean companies such as LG Chem, Samsung SDI, and SK Innovation."

This content was produced with the assistance of AI translation services.