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SK On to invest $1.1B, quadruple domestic battery capacity

Published: 16 Aug. 2023, 14:14 Updated: 16 Aug. 2023, 17:01

SARAH CHEA
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SK On CEO Jee Dong-seob, center, takes a photo with South Chungcheong Governor Kim Tae-heum, right, and Seosan Mayor Lee Wan-seob after signing an agreement of $1.1 billion battery investment in the city Wednesday. [SK ON]

SK On is investing 1.5 trillion won ($1.1 billion) to build a third battery factory in Seosan, South Chungcheong, that will significantly up its domestic production capacity.

It is the largest domestic investment ever for the Korean battery maker.

SK On said Wednesday it signed a memorandum of understanding with the South Chungcheong Provincial Office and the Seosan city government to secure investment to construct a factory at a 44,125-square-meter (10.9-acre) site near the company's No. 1 and 2 facilities.

The latest investment will increase the company's production capacity in Seosan fourfold, SK On said.

The third factory will be constructed by 2025 and will have a capacity of 14 gigawatt-hours (GWh) by the end of 2028.

This will boost SK On's domestic production capacity to 20 GWh, enough to supply around 280,000 electric vehicles.

SK On's battery manufacturing plant in Seosan, South Chungcheong [SK ON]

"The latest investment is meaningful in that it strengthens the country's overall battery production capability," SK On CEO Jee Dong-seob said. "SK On will endeavor to become a leader in the EV industry by contributing to a regional economy based on aggressive investments."

SK On said its third factory in Seosan will be a smart factory, which will raise production speed by 30 percent and increase accuracy.

Seosan is where the company first started its battery production back in 2012. The No. 1 plant initially had a 0.2 GWh capacity, which was expanded to the current 5 GWh through a series of expansions.

the company's investment comes as Hyundai Motor prepares to break ground on its first domestic EV factory in Ulsan in September.

SK On is a major battery supplier to Hyundai Motor and is currently the fifth-largest battery maker globally with 89 GWh of global production capacity.

It is building four more plants in the United States and Europe, which will boost its capacity to 220 GWh by the end of 2025.

SK On aims to become the third-biggest market player by 2025.