LG Chem to Supply Next-Generation Cylindrical Batteries to US 'Lucid Motors'

[Asia Economy Reporter So-yeon Park] LG Chem has officially partnered with Lucid Motors, a luxury electric vehicle company gaining attention.

In this regard, LG Chem announced on the 26th that it will exclusively supply next-generation cylindrical batteries to the standard model of Lucid Motors' luxury electric vehicle, the Lucid Air, from the second half of this year through 2023. The specific supply volume and amount will not be disclosed due to contractual agreements.

Lucid Motors is a newly emerging electric vehicle company that has attracted global attention after securing a $1 billion (approximately 1.15 trillion KRW) investment from the Saudi Arabian sovereign wealth fund in 2018. It plans to launch its first mass-produced vehicle, the Lucid Air, in the second half of this year.

The Lucid Air is a luxury electric sedan that accelerates from zero to 100 km/h in just 2.5 seconds and offers a driving range of 643 km on a single charge.

LG Chem has first signed an exclusive supply contract for cylindrical batteries for the standard model of the Lucid Air and is reportedly negotiating battery supply for special models as well.

Supply of Next-Generation Cylindrical Battery ‘21700’ Model

The batteries LG Chem supplies to Lucid Motors are next-generation cylindrical batteries known as the ‘21700’ product.

The cylindrical ‘21700’ battery features an outer dimension of 21mm in diameter and 70mm in height, increasing capacity by 50% and improving performance compared to the existing cylindrical ‘18650’ battery (18mm diameter, 65mm height). The commercialization of the ‘21700’ allows for fewer batteries to be connected to achieve the desired capacity compared to the ‘18650’.

Since Lucid Motors' electric vehicles use thousands of small cylindrical batteries, reducing the number of batteries makes management easier and enhances safety. Therefore, electric vehicle manufacturers using cylindrical batteries are continuously seeking suppliers who can reliably provide cylindrical ‘21700’ batteries.

LG Chem was the first in Korea to commercialize and mass-produce cylindrical batteries in 1998 and launched the world's first high-capacity 2200mAh battery for laptops in 2001. Leveraging this long-term know-how and mass production experience, LG Chem succeeded in developing and mass-producing the highest-spec cylindrical ‘21700’ batteries, earning Lucid Motors' selection.

Kim Jong-hyun, President of LG Chem's Battery Business Division, said, “By supplying cylindrical batteries to Lucid Motors, we have strengthened our electric vehicle battery business portfolio alongside pouch batteries,”

and added, “We will actively target the rapidly growing cylindrical battery market for electric vehicles and aim to secure a definitive global No. 1 position in the electric vehicle battery sector in the future.”

Peter Rawlinson, CEO of Lucid Motors, stated, “Collaboration with LG Chem is the best plan for Lucid Motors to efficiently produce electric vehicles,” adding, “This allows us to guarantee the best electric vehicle performance to our customers.”

Strengthening Electric Vehicle Battery Portfolio with Both Pouch and Cylindrical Batteries

LG Chem is accelerating its efforts to target not only the existing pouch battery market but also the cylindrical battery market for electric vehicles.

Recognizing the potential of electric vehicles equipped with cylindrical batteries early on, LG Chem has led the development of high-performance cylindrical batteries, such as supplying ‘NCM811’ cylindrical batteries to electric buses in 2018. The cylindrical batteries supplied to Lucid Motors will also incorporate ‘NCM811’ technology.

‘NCM811’ refers to a battery cathode material composition of 80% nickel, 10% cobalt, and 10% manganese. Increasing the nickel content in the cathode maximizes the battery's energy density. However, nickel itself generates high heat, which can cause safety issues such as overheating, requiring advanced technological capabilities.

In its 2019 earnings announcement held on the 3rd, LG Chem also stated, “The growth of electric vehicles and LEVs using cylindrical batteries will be significant,” and “We will continue to focus on the electric vehicle and LEV markets and concentrate on new investments,” demonstrating its commitment to aggressively targeting the cylindrical battery market.

With the supply contract with Lucid Motors as a milestone, LG Chem has secured a full portfolio in the electric vehicle market, which is divided between large pouch and small cylindrical batteries.

In the existing large pouch battery sector, LG Chem has supplied batteries to 13 of the top 20 global automakers, including Volkswagen, Renault, Volvo, GM, and Hyundai, and recently announced the establishment of a large-scale electric vehicle battery joint venture with GM, securing an order backlog worth 150 trillion KRW.

Additionally, LG Chem has secured large-scale supply contracts in the cylindrical battery electric vehicle sector, led by companies like Lucid Motors, establishing a comprehensive supply system across all electric vehicle battery types.

Meanwhile, according to market research firm SNE Research, the cylindrical electric vehicle battery market is expected to grow at an average annual rate of 25%, from 76.4 GWh this year to 150 GWh in 2023 and 227.9 GWh in 2025.

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