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SK Innovations’ investment in battery business comes to fruition

SK Innovations’ investment in battery business comes to fruition

Posted November. 11, 2020 07:42,   

Updated November. 11, 2020 07:42


SK IE Technology (SKIET), electric vehicle (EV) battery material subsidiary of SK Innovation, started the operation of its separator plant in Changzhou, China in full swing. The Changzhou plant is the company’s first overseas production site. SK Innovation plans to venture into China, the world’s largest electric car market, by expanding its production site for separators, which is a key material for EV batteries, in China.

SK Innovation said on Tuesday that SKIET’s new separator plant in Changzhou has an annual production capacity of 340 million square meters, which is equivalent to 31 giga-watts of batteries. The new plant will boost SKIET’s total annual production capacity to 870 million square meters including 530 million square meters from its plant in Jeungpyeong, North Chungcheong Province. SKIET is also building a separator plant in Poland, which is capable of producing 680 million square meters a year, in order to target the European market. The new plant in Europe is scheduled to start operation in the third quarter of next year.

In addition to its battery plant with an annual production capacity of 7.5 gigawatt-hours in Changzhou, SK Innovation has secured a stable supply chain for separators. With its new battery plant in Yancheng, which has a production capacity of 10 gigawatt-hours, set to start operation early next year, SK Innovation is expected to gain the upper hand in the rapidly growing Chinese EV market.

Separator is one of the four key materials for EV battery along with anode, cathode, and electrolyte. The global battery industry expects the 4.1 billion square meter separator market will increase by four fold to 15.9 billion square meters by 2025.

“The global separator market is virtually dominated by Japanese companies, such as Toray and Asahi Kasei,” said an official from the battery industry. “SKIET, the only separator maker in Korea, is making meaningful results after 17 years of developing separators.” SKIET CEO Noh Jae-seok said the company has gained a competitive edge in the global separator market by building a production site in the world’s largest EV market. SKIET aims to capture 30 percent of global market share by increasing its production capacity to 1.87 billion square meters by the end of 2023.

SK Innovation, a latecomer in the global battery market, is growing at a rapid pace. After joining the global top ten battery maker for the first time last year, it rose to fourth place in September this year with 4.7 percent market share (by shipment) following LG Chem, CATL of China, and Panasonic of Japan.

The company’s order backlog at the end of this year is expected to be 550 gigawatt-hours. “We expect to achieve mid-3 trillion won in sales in 2021 and mid-5 trillion won in 2022 once our overseas production plants, which are currently under construction in the U.S. and Europe, start operation and contractual orders start to be executed,” said Yoon Hyung-jo, head of SK Innovation’s Battery Business Support Division, during a conference call for the third quarter results held on Oct. 30.

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