– After GM and Ford, Stellantis also finally joined
– Positive impact on Korean auto parts makers
– Following GM and Ford, Stellantis also joined K-Battery
The craze for battery alliances among American auto OEMs is strong. The battery alliance, which started as 'Ultium Cells', a joint venture between GM and LG Energy Solutions, has now brought all of the BIG 3, which collectively refers to the largest US automakers GM, Ford, and Stellantis, together with Korean battery makers. Industry experts emphasize that the industry will grow further according to the Joe Biden administration's policy to encourage the distribution of electric vehicles, and the present moment as Korea is solidifying its position as an electric vehicle battery powerhouse in the United States will be a good opportunity for Korean companies.
<March LG Energy Solutions-Stellantis battery joint plant site for a commemorative photo>
[Source: Stellantis]
<May Samsung SDI-Stellantis Joint Venture Ceremony>
[Source: Samsung SDI]
BIG 3, Battery Alliance Status
(Stellantis) Following GM and Ford, Stellantis joined hands with Korean companies, and virtually all of the Big 3 American automakers formed a K-battery alliance. Stelantis, which signed a memorandum of understanding (MOU) with LG Energy Solutions last October to establish an electric vehicle battery joint venture in North America, announced on June 6 that it confirmed the name of the joint venture as 'NextStar Energy'. The joint venture with an investment of US$3 billion is scheduled to be built in Windsor, Ontario, Canada, which borders Detroit, Michigan. The annual production target is 41 gigawatt hours (GWh), and the production volume is mounted on Stellantis electric vehicles.
In addition, immediately after President Joe Biden's visit to Korea in May, Stellantis invested more than $ 5 billion (gradual increase to $ 25 billion) in Kokomo, Indiana, with Samsung SDI, with an annual production target of 31GWh. The first operation is scheduled for the first quarter of 23, and it plans to expand its production capacity to 5GWh within several years. The plants are also expected to contribute to the local economy in Windsor and Kokomo. Samsung SDI plans to produce electric vehicle battery cells and battery modules at its Indiana plant, a joint venture with Stellantis, by applying high-quality battery brand 'PRiMX' technology for various electric vehicles produced by Stellantis' North American assembly plants. Stellantis also announced a goal to increase the sales rate of electric vehicles to 24% in North America and 2025% in Europe by 1. Carlos Tavares, CEO of Stellantis, said in a recent interview, "As we further strengthen our global battery production capacity, we will contribute to the promotion of 'future decarbonization'."
(GM) GM, a leader in the K-battery alliance, is building Ultium Cells, a joint venture of LG Energy Solutions, with the goal of becoming the largest electric vehicle battery plant in the United States in Ohio from 2019, and is scheduled to complete and begin mass production within this year. Ultium Cells has the largest production capacity as it is expanding its production base to the third plant. This is because the first plant in Ohio and the second plant in Tennessee are scheduled to start construction with a capacity of 3GWh and 1GWh for the third plant, respectively (region undecided).
(Ford) Last year, Ford established a joint venture with SK On and 'Blue Oval SK' and is promoting two factories in Kentucky, each with a capacity of 43 GWh, and is scheduled to operate in phases from 2. In addition, a 2025GWh plant in Tennessee is scheduled to operate from 43. SK On's own plant in Georgia, which started operation in January this year, is successfully procuring Ford's electric pickup trucks.
Battery life matters
As such, although all US auto OEM BIG3 have joined hands with Korean companies, there is an opinion that it is still too early to feel relieved. This is because start-ups dreaming of becoming the second Tesla are appearing in the market one after another with competitive battery performance. According to market research firm Statista, based on estimates from the US Environmental Protection Agency (EPA), the percentage of battery life per mile for each electric vehicle model was the highest for Lucid Air Dream and Tesla Model 2.
<Battery duration by electric vehicle model>
[Source: Statista ('22.1.)]
Electric vehicle battery types
<Electric Vehicle Battery>
Note: (from left) pouch type, square shape, cylindrical shape
[Source: LG Energy Solution, Samsung SDI, Tesla website]
Preparing for what types of electric vehicle batteries will become mainstream in the future is also considered an important task in understanding the current state of the US battery alliance and the future mobility market. There are three major types of electric vehicle batteries: pouch type, prismatic type, and cylindrical type. In addition to cost reduction, the most important goal of battery development is to increase energy density (a major determinant of a vehicle's electric driving range), while also reducing installation space and weight. American automakers are using different types of batteries for different reasons. What type of battery will be universally used in the next generation is a major concern in the industry.
(Pouch type) This battery is mainly manufactured by LG Energy Solution and SK On. The size is medium to large, but it has a small volume, so it can be used in various forms. It is mainly used in the vehicles of manufacturers such as GM, Ford, Volvo, Nissan, and Hyundai/Kia.
(Prismatic) As a battery used in vehicles such as BMW, Benz, and Porsche, Volkswagen recently announced plans to increase the proportion of standardized prismatic batteries by 2030 and to produce its own. It is a medium-to-large battery that is strong against external shock and heat. It has an aluminum metal exterior and is characterized by high energy density. Large Chinese companies such as CATL and BYD mainly produce prismatic batteries, and Samsung SDI and Toshiba also produce them.
(Cylindrical) This is a battery mainly used in Tesla. It has excellent mechanical stability, so it is easy to configure the battery pack and the production price is low. It is the most suitable form for mass production, but has the disadvantage of lower energy density compared to the pouch type. It is manufactured by Panasonic, which is a partnership with Tesla, LG Energy Solution, and Samsung SDI.
implication
Under the Joe Biden administration, the U.S. policy of distributing electric vehicles has been strengthened, and the establishment of a regional battery production network for U.S. automakers has become the biggest task. The U.S. government promises to achieve carbon neutrality by 2050 ▷ Increase the share of domestic electric vehicle sales to 2030% by 50 and add 50 electric vehicle charging stations ▷ Convert all bus production to carbon-free electric buses by 2030 ▷ Electric vehicle-related tax Offer benefits and incentives to eco-friendly car manufacturers ▷ Incentives for vehicle owners to switch to eco-friendly vehicles such as electric vehicles ▷ Government officials’ aggressive electric vehicle distribution policy that aims to change all 300 million vehicles used in public institutions, including official cars, to electric vehicles situation that is being presented. Industry experts pointed out that in the current situation, it can be a win-win for all three American automobile BIG companies to form alliances with Korean battery companies and promote plant construction, but it is necessary to keep an eye on whether the supply of raw materials, such as rare earths, will go smoothly. do.
Joe McCabe, CEO of Autoforecast, an American automobile research institute, said in an interview with KOTRA Detroit Trade Officer, “Even if future problems are excluded, the current situation can act as a positive factor for Korean parts makers. “We have to get on the flow and come up with solutions to factors such as supply chain issues and price competition,” he said. In the United States, electric vehicle start-ups, including automakers, are expected to aggressively mass-produce electric vehicles for the next five years. It's time to prepare for the opportunity.
Source: GM, Ford, Stellantis, Samsung SDI, LG Energy Solutions, Tesla, Statista, Detroit Free Press, KOTRA Detroit Trade Center