South Korea’s LG Energy Solution is negotiating with three unnamed Chinese suppliers to produce low-cost electric vehicle batteries for the European market. This is according to a report by the news agency Reuters. The move comes amid heightened competition after the EU imposed additional tariffs on electric vehicles made in China.
Different Approaches Under Consideration
LGES wants to use the potential partnerships to reduce the production costs of LFP batteries in order to keep up with its cheaper Chinese competitors. To this end, the company is in talks with Chinese partners to jointly develop and produce LFP cathodes for the European market. LGES is considering a number of options, including joint ventures and long-term supply agreements. The aim is to reduce production costs for LFP batteries to the level of Chinese competitors within three years.
According to Wonjoon Suh, head of LGES’ advanced automotive battery division, three locations are being considered for LFP cathode production in cooperation with Chinese companies: Morocco, Finland and Indonesia. The focus is on the European market, where the demand for low-cost EV models and therefore for LFP cells is particularly high.
