LG Chem and Japan's Toray Establish Membrane Separator Joint Venture in Hungary

Securing an Annual Production Capacity of 800 Million m² with Over 1 Trillion Won Investment

[Asia Economy Reporter Yoonju Hwang] LG Chem is partnering with Japan's Toray to establish a joint venture for battery separators in Europe, investing 1 trillion KRW to target the European separator market.

On the 27th, LG Chem announced that it signed a contract with Toray to establish the joint venture 'LG Toray Hungary Battery Separator Kft.'

The joint venture will be established with a 50:50 equity ratio, and after 30 months, LG Chem plans to acquire an additional 20% stake from Toray to secure management control. Both companies will invest more than 1 trillion KRW in stages, including LG Chem's initial capital contribution.

The factory will be built on the site of Toray's existing affiliate factory (Toray Industries Hungary Kft) located in Nyerges?jfalu, Kom?rom-Esztergom Province, in northwestern Hungary. The total area is 420,000 m², which is equivalent to the size of 60 soccer fields.

Both companies plan to secure an annual production capacity of over 800 million m² by 2028. Line expansion is scheduled to begin in the first half of next year, and the produced separators will be supplied to European battery companies such as LG Energy Solution's Poland plant in Wrocław.

The reason for establishing the joint venture is that Toray aims to secure a stable supply source in Europe based on LG Chem's subsidiary LG Energy Solution, while LG Chem seeks to rapidly enter the European market, a global electric vehicle production hub, by internalizing Toray's core separator raw material technology.

Through this joint venture, Toray will secure a definite demand base in the European market, and LG Chem will strengthen its position as a global separator business operator by combining its own coating technology with Toray's differentiated raw material business capabilities.

Both companies have created an opportunity to actively target the rapidly growing European electric vehicle market through this joint venture. The European electric vehicle market is recognized as one of the world's top three electric vehicle markets alongside China and the United States and is growing rapidly.

According to global market research firm IHS Markit, the European electric vehicle battery market is expected to grow at an average annual rate of 38%, from 82 GWh this year to 410 GWh in 2026.

In July, LG Chem announced its plan to become the world's largest comprehensive battery materials company by acquiring LG Electronics' separator coating business and nurturing the separator business to a trillion-KRW scale within several years.

Currently, coating production lines operate in Cheongju, South Korea; Hangzhou, China; and Wrocław, Poland, Europe. LG Chem has secured technology to maximize productivity, including processing capabilities that enable the world's fastest separator coating. In particular, LG Chem and Toray jointly own the SRS® (Safety Reinforced Separator) technology, which thinly coats the separator surface with ceramic material to significantly improve safety and performance. Based on this, both companies plan to maximize business synergy by cooperating in their respective strengths in coating processing technology and raw material manufacturing technology.

Vice Chairman Shin Hak-cheol said, "The establishment of the joint venture with Toray is an innovative change that creates synergy by combining LG Chem's coating technology and Toray's raw material capabilities, which are world-class technologies, beyond simple cooperation. Based on industry-leading technology, we will actively nurture the separator business and leap forward as the world's number one comprehensive battery materials company."

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