South Korean battery firm LG Chem has agreed a deal to acquire a “massive volume” of a key material from China’s largest lithium compounds producer, to spur production of batteries for electric vehicles.
LG Chem said it had signed a contract with Ganfeng Lithium for the supply of a total 48,000 tons of lithium hydroxide, “enough to manufacture about one million batteries”.
The deal comes in the wake of a recent supply deal LG Chem signed with Canada’s Nemaska Lithium.
“The two contracts combined total 83,000 tons of lithium hydroxide, which could be used to manufacture about 1.7 million batteries for high-performance electric vehicles,” LG Chem said.
According to LG Chem, its backlog of car battery orders “surpassed 60 trillion South Korean won” (US$53 billion) by the end of last June and the company’s battery production capacity is set to increase from 70 gigawatt hours to 90 GWh by 2020.
Last year, South Korea’s government backed plans by LG Chem and other national battery giants to inject the equivalent of around US$2.3bn into the battery manufacturing sector over the next three years, to expand production and challenge China’s increasing dominance of the market.
