A legal dispute between LG Chem and SK Innovation, South Korean battery manufacturers, could create a battery shortage for Ford and Volkswagen who are relying on SK Innovations battery cells for their future electric vehicles.
SK Innovation was to build a battery plant in Georgia to supply Ford and Volkswagen, however, courtroom drama between SK Innovation and LG Chem have complicated the deals.
LG Chem is suing SK Innovations over claims of industrial espionage in the United States and LG is demanding SK not be allowed to manufacture batteries in the US. This isn’t the first time the South Korean companies have butted heads, as each appears to be willing to do what it takes to get the upper hand in the battery supply market.
LG Chem, which plans to build a battery factory with GM in Ohio, secured backing from Ohio’s governor, who said the ITC needs to “remedy SKI’s unfair competition,” the documents, dating from May and seen on Tuesday showed.
He said a failure to do so could threaten investment by LG Chem and GM that will “will bring manufacturing jobs back to the United States, ultimately employing around 1,100 American workers”.
“SKI is accused of stealing LG Chem’s intellectual property and using it to directly compete against workers in Ohio,” Ohio governor Mike DeWine said in a statement to the ITC in May.
SK Innovation is building its first battery plant in Georgia to serve VW’s EV base in Chattanooga. Tenn. Production of the [Volkswagen] ID4 electric vehicle is scheduled to begin there in 2022.
Ford and VW, meanwhile, have both warned that this battle puts their EV plans at-risk due to battery supply shortages. Volkswagen’s MEB platform, which underpins the European ID.3 electric hatchback and ID.4 electric crossover to be built in Chattanooga, will spawn future Ford models.
The battery battle should not delay delivery of the Mustang Mach-E, which uses LG Chem batteries manufactured in Poland.