SK Innovation to Build Third European Battery Plant... Secures Land Equivalent to 98 Football Fields

[Asia Economy Reporter Kim Hyewon] SK Innovation has decided to invest in the trillion-won range to build an additional battery production base in Europe, one of the largest automobile markets and home to global automakers.

On the 28th, SK Innovation held a board meeting and announced on the 30th that it resolved to invest $1.148 billion (approximately 1.27 trillion KRW) in its local subsidiary SKBH (SK Battery Hungary) to construct a new production plant in Europe.

The newly decided European third plant will have an annual production capacity of 30GWh (based on a 70kWh electric vehicle battery capable of driving over 400km on a single charge, supplying about 430,000 vehicles) and will be built in Iv?ncsa, Hungary. SK Innovation's first and second European plants are also located in Kom?rom, Hungary. In terms of investment scale, this is the largest battery factory SK Innovation has built in Europe.

To this end, SK Innovation secured a site of approximately 700,000㎡ (about 210,000 pyeong) in Iv?ncsa. This area is equivalent to 98 soccer fields.

The European third plant is a long-term project, with construction starting in the third quarter and investments being made sequentially until 2028. The total investment cost amounts to $2.29 billion (approximately 2.6 trillion KRW). The funds invested this time represent 50% of the total investment, and SK Innovation plans to raise additional funds required for factory construction through external financing as needed, according to the funding schedule.

In this regard, SK Innovation's top executives held an official online meeting with the Hungarian government on the afternoon of the 29th to formalize the investment. Attendees included P?ter Szijj?rt?, Hungarian Minister of Foreign Affairs and Trade; Turbo Moln?r, Mayor of Iv?ncsa; and R?bert Isik, Head of the Investment Agency. From SK Innovation, President Kim Jun and Battery Business Head Ji Dongsup participated.

With this investment decision, SK Innovation has taken a step closer to its mid-to-long-term goal of becoming a global electric vehicle battery company with an annual production capacity of '125GWh+α by 2025.'

Notably, SK Innovation's large-scale investment decision stands out because, unlike previous projects where factory construction was pursued around 10GWh based on order status, this time it plans to build a large-scale 30GWh plant. SK Innovation explained that this reflects its determination to secure business competitiveness in the rapidly growing electric vehicle market environment and to leap forward as a global top player through more aggressive order acquisition. It will also enable flexible response to the battery demand in Europe, which is expected to increase more than sixfold from 41GWh currently to 256GWh by 2025.

President Kim said, "Although management conditions are difficult due to COVID-19 and other factors, this decision was made to further expand the green mobility business aimed at completing the company's growth strategy based on the financial story and environmental, social, and governance (ESG) principles." He added, "This investment will not only contribute to the value chain and ecosystem development of the global electric vehicle industry but also enable SK Innovation's battery business to become a leading company in the electric vehicle battery industry in the long term."

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