More efforts needed to develop state-of-the-art technologies
President Moon Jae-in said his administration will take steps to lift the nation to become the world’s No. 1 battery manufacturing powerhouse by the year 2030. Moon vowed to fully support domestic batter companies in their efforts to advance this so-called “K-battery” development. “Batteries have emerged as the central part of future industries,” Moon said during a ceremony at an LG Energy Solution (LGES) battery plant in Ochang, North Chungcheong Province, Thursday.
Relevant Korean companies such as LG, Samsung and SK are planning to invest a total of 40.6 trillion won ($35.5 billion) in the sector by 2030 including 20.1 trillion won for research and development (R&D) activities. They plan to commercialize a solid-state battery, regarded as a “game changer” in the secondary battery sector, by 2027, with lithium-sulfur and “lithium-metal” batteries set to be commercialized in 2025 and 2028, respectively. Toward that end, the administration will provide a maximum of 40 percent to 50 percent in tax benefits to battery manufacturers as it previously did to semiconductor businesses.
It is desirable for the government and the private sector to jointly map out plans to boost the K-battery to the top of the global market. Such efforts are necessary given that an increasing number of international companies have been catching up with domestic firms. Last year, Korea, China and Japan, combined, accounted for 95 percent of the global battery market; 44.1 percent for Korea, 33.2 percent for China, and 17.4 percent for Japan.
Yet the situation has begun to change this year, with the rapid rise of Chinese companies. Firms such as CATL, BYD and Gotion High-tech have seen fast growth, boosted by the Chinese government’s much-touted drive toward the use of electric vehicles. China accounts for about half of the global electric automobile market.
LGES once ranked the first in the battery market, surpassing CATL. But its share fell to 23.1 percent in the first five months of this year, compared to 31.2 percent for CATL. Major global carmakers including Tesla, Volkswagen and Toyota have also begun to enter the market, posing a grave challenge to domestic companies.
To cope with the looming challenges from Chinese and other global firms, domestic companies should focus on developing state-of-the-art technologies and explore new markets. Currently, the United States is the second largest market for domestic battery makers; but it will likely emerge as the largest market, soon outpacing China.
This is because the U.S. has been enticing Korean battery firms in a bid to counter China. These firms, currently accounting for 10 percent of the U.S. market, will be able to take the lion’s share should they more proactively seek cooperative ties with their U.S. counterparts. Korean companies need to focus on the development of the solid-state battery at the earliest date possible, as it is called the “dream battery” with excellence in terms of durability and safety.
K-battery nurturing
Source: Buhay Kapa PH
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