The South Korea–based electric vehicle battery technology firm SK Innovation will be investing 840.2 billion won (around $777 million) into the development of an electric vehicle battery production facility in Hungary, according to reports.
This new facility is intended to help the company meet growing demand for its products in the European auto sector — with such demand expected to grow rapidly over the coming years as more plug-in electric models are brought to market by manufacturers in a hurry to meet tightening regulatory standards and not have their lunch eaten by Tesla and other fast-moving competitors.
The threat of zero emissions zones in the central districts of some major cities is expected to spur growth in the sector as well.
“SK Innovation, which owns South Korea’s top refiner SK Energy, plans to break ground in February 2018 and start production from early 2020, the company said in a statement,” as reported by Reuters. “The announcement comes as SK Innovation and other South Korean EV battery makers have suffered a major setback in China, the world’s top auto market, amid diplomatic tensions between the two countries.
“Electric vehicles powered by South Korean batteries have been excluded from state subsidies in China. SK Innovation has suspended an EV battery pack plant in China with China’s Beijing Automotive Group and Beijing Electronics, and had also delayed a plan to build an EV battery cell factory in China.”
Overall, that no doubt makes for a situation whereby the European market is looking increasingly attractive — hence the increasing investment plans.
The new electric vehicle battery manufacturing facility will reportedly possess a production capacity of around 7.5 gigawatt-hours (GWh) a year. Customers, as one would guess, are expected to include Daimler (Mercedes-Benz). SK Innovation also produces EV batteries for Kia.