US Georgia Plant Seeking Moon Aims to Become World's Largest Battery Hub in 3-4 Years

SK Innovation US Electric Vehicle Battery Plant, Construction of 2nd Plant Underway
Chairman Chey Tae-won May Announce Additional Investment Plans for 3rd and 4th Plants

An electric vehicle battery factory that SK Battery America is building in Commerce, Georgia. The first plant on the right in the photo was completed earlier this year and is producing prototypes. Photo by SK Innovation

[Asia Economy Reporter Choi Dae-yeol] After the South Korea-US summit on the 21st (local time), President Moon Jae-in plans to visit SK Innovation's electric vehicle battery plant in Georgia on his way back home. Among the main agenda items of this summit, vaccine cooperation between South Korea and the US is highlighted, and one of the cards that can be leveraged is the battery ecosystem. This is because Korean battery companies, which are regarded as technologically and visually advanced, have the potential to contribute to the expansion of electric vehicle adoption by increasing local investment.

Together with Europe and China, the US is considered one of the world's three largest automobile markets, but it is relatively behind in electric vehicles. As of last year, 1.4 million electric vehicles were sold in Europe, 1.34 million in China, competing closely, while the US sold about 330,000 units. Conversely, this indicates that the US market has greater potential for growth in the future.

Under the Biden administration, policies to actively address climate change and increase the adoption of eco-friendly vehicles have been implemented, and major local automakers have responded by releasing new models one after another. According to KOTRA and others, the electric vehicle market share in the US remained in the 1% range last year but is expected to increase to 26% by 2030.

Brian Kemp, Governor of Georgia, USA, is greeting attendees at a factory groundbreaking ceremony held in March 2019. SK's local battery business is considered the largest foreign investment in Georgia's history. Photo by Georgia State Website

At the groundbreaking ceremony for the SK Georgia battery plant held in 2019, Choi Jae-won, Senior Vice Chairman of SK Group, and Kim Jun, President of SK Innovation, attended. SK Group Chairman Choi Tae-won decided to visit the plant for the first time during this trip to the United States. Photo by Georgia State website

Unlike domestic competitors such as Samsung and LG, SK's battery business focuses on electric vehicles. As a latecomer, SK is concentrating on the US market. SK announced its investment plan in the US in 2018 and began constructing a large-scale plant in the Commerce area of Georgia. From the outset, the site was planned with up to four plants in mind. The first plant, completed earlier this year, is currently producing prototypes with mass production targeted within the year, and the second plant is expected to be completed in the first half of next year. The third and fourth plants are under internal review. SK Group Chairman Chey Tae-won is scheduled to visit the plant for the first time, and there is a possibility of announcing additional investment plans during this visit. Industry insiders, including securities firms, consider the possibility of establishing joint ventures with local automakers to build additional plants as a plausible scenario.

Batteries produced at the Georgia plant are supplied to Ford and Volkswagen. The local automotive industry's keen interest in SK's Georgia plant stems from the fact that it supplies batteries for Ford's F-150 electric pickup truck, the most popular vehicle among Americans. President Biden personally visited Ford's plant and conducted an unscheduled test drive a day before the unveiling of the 'F-150 Lightning,' clearly signaling his intention to lead the global electric vehicle market. Volkswagen also prioritizes expanding its market share in the US to increase sales. Tesla currently dominates the US electric vehicle market.

On the 18th (local time), U.S. President Joe Biden, who visited the Ford Dearborn plant, answered questions from the press after test-driving the F-150 Lightning.

If all four of SK's local plants in the US are completed, they will rank among the largest globally. The production capacity of SK's Georgia Plants 1 and 2 slightly exceeds 20GWh. If Plants 3 and 4 are built at a similar scale, the total capacity is expected to reach about 45GWh, enough to supply 700,000 electric vehicles.

LG Energy Solution, which entered the US market early, and Ultium Cells, a joint venture with the largest US automaker General Motors (GM), are building plants in Ohio and recently confirmed a plant in Spring Hill, Tennessee, each with a capacity of 35GWh. The world's largest supplier, China's CATL, is constructing a 45GWh plant domestically. Tesla's Gigafactory in Nevada has a capacity of 20GWh.

SK has declared its intention to increase battery production capacity to 125GWh+α by 2025. This year, the company's production is about 60GWh, so it needs to more than double. Considering the typical construction period of about two years, construction is expected to begin by next year at various global bases including the US, Europe, and China. While SK outsourced construction to other domestic and international companies for its European plant, SK Construction, a group affiliate, is building the Georgia Plant 2.

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