Korean EV battery makers to invest $2.84 bn on factory automations in U.S.

Korean EV battery makers to invest $2.84 bn on factory automations in U.S. [Photo by MK DB]

Korean electric vehicle battery makers are pouring money into process automation to boost product yields in response to growing EV demand worldwide.

According to sources on Thursday, Korea’s three major battery names – LG Energy Solution Ltd., SK on Co. and Samsung SDI Co. – are seeking to invest a combined 3.5 trillion won ($2.84 billion) in automation and inspection equipment at their U.S. plants this year alone. They already started to increase orders for related to automations and inspections from the end of last year.

At a newly built battery factory, the product yield is usually lessF than 50 percent, which means that 5 out of 10 products are defective. For stable product supply, the yield must be over 90 percent. Such plants recruit process management experts to meet this standard, but the three battery firms are focusing on factory automation since human labor alone is limited in solving the problem.

LG Energy Solutions is building a smart factory in cooperation with Siemens AG of Germany and Korean partners including LG CNS Co., Cowintech Co. and Avaco Co. Sources said that LG Energy Solutions is investing 1.77 trillion won in process automation and inspection in the U.S. alone.

SK on is also going all out for a smart factory. The company is expected to inject 1.5 trillion won mainly in BlueOval SK, a joint venture with Ford Motor Co. for EV batteries. SK on’s automation focus is ‘manufacturing intelligence’, which is designed to collect and analyze data generated in the entire process of research and manufacturing to increase its yield.

Samsung SDI’s investment in North America is relatively small. The company’s orders for automation and inspection equipment in the U.S. are estimated to be around 240 billion won.