Battery Firm Could Build its Own Factory Amid Dispute

LG Energy Solution could build its own battery plant in Georgia if rival SK Innovation can't proceed.

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ATLANTA (AP) — With a giant battery factory in northeast Georgia hanging in the balance of a trade dispute, South Korean company LG Energy Solution is now telling some Georgia officials that it could build its own factory in the state if rival SK Innovation can't proceed.

The Atlanta Journal-Constitution reports LG Energy Solution CEO Jong Hyun Kim wrote a Wednesday letter to Democratic U.S. Sen Raphael Warnock on Wednesday saying LG “is prepared to do whatever we can to help the people and workers of Georgia."

Kim also wrote that if some other entity acquires the SK plant, LG could help run the $2.6 billion electric vehicle battery plant in Commerce, where SK plans to hire 2,600 workers.

“Multiple investors and manufacturers … will be interested in the Commerce plant due to increased demand for electric vehicle batteries,” Kim wrote.

Thursday, LG announced plans to build at least two new plants and spend more than $4.5 billion to make electric vehicle batteries in the United States, in addition to a plant it already operates in Holland, Michigan, one it's building in Lordstown, Ohio, and one it could build in Spring Hill, Tennessee. All those plants are in partnership with General Motors.

LG's overture comes as Republican Gov. Brian Kemp on Friday renewed his call for President Joe Biden to override a federal trade decision that threatens SK's ability to move ahead.

The U.S. International Trade Commission ruled in February that SK stole 22 trade secrets from LG and that SK should be barred from importing, making or selling batteries in the United States for 10 years.

SK has contracts to supply batteries for an electric Ford F-150 truck and an electric Volkswagen SUV to be manufactured in Chattanooga, Tennessee. The commission said SK can supply batteries to Ford Motor Co. for four years and to Volkswagen for two years. SK can also repair and replace batteries in Kia vehicles that have already been sold.

An SK spokesperson said in an emailed statement that “it is simply impossible for someone to acquire an EV battery manufacturing facility and run it to produce batteries acceptable to a major auto company.”

“LG’s monopolization of the U.S. battery supply chain will only set the U.S. further back in its effort to catch up with China,” the spokesperson wrote.

Biden has until April to review or block the ruling and both side are lobbying him, part of a chess game that also involves talks between the companies. SK lost the ruling in part because it destroyed evidence. The commission called the move “extraordinary” and concluded that top SK executives ordered the destruction.

SK said this week that its directors had rejected LG's demands for compensation. LG said it was “regrettable” that SK wasn't willing to negotiate and said LG would accept cash, royalties on future battery sales, or an ownership share in SK's business.

Georgia gave $300 million in free land, cash and other incentives for the SK factory, which is now partially built and is supposed to open in 2022.

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