LG Chem becomes second largest EV battery maker in China

LG Chem has become the second largest supplier of electric vehicle (EV) batteries in China, according to a local research firm.

The South Korean battery giant moved 2087MWh of batteries used in EV from January to May, Battery China said.

Local vendor CATL topped the list with 6178MWh while BYD placed third with 1943MWh.

It is the first time since 2016 for LG to take second place in battery supply in the world’s second largest economy.

The company fell from the rankings since that year due to China and South Korea’s dispute over the latter’s installation of THAAD, which Beijing opposed. China halted its EV battery subsidies to Korean makers in retaliation for the installation.

LG Chem’s topping the list is due to its Nanjing battery plant beginning operations of Factory 2 this year. It is supplying 21700 batteries to Tesla’s Gigafactory Shanghai’s Model 3 factory.

Model 3 has proven popular in China, reaching over 10,000 units sold in March.  This dipped to 3,635 units in April due to the COVID-19 pandemic but has recovered to 11,095 units in May.

LG’s Nanjing plant is targeting an output of 32GWh by 2023. The South Korean company is planning to invest 2.1 trillion won to achieve this.

The plant posted 800 million yuan in revenue in the first quarter. LG is aiming for an annual revenue of 6 billion yuan this year.

Meanwhile, a total of 12.79GWh of EV batteries were supplied in China from January to May, a drop of 45.34% from the same period a year ago. Leader CATL’s shipment was also considerably lower than the 10,092MWh it moved last year.

This was due to low sales of EV from the virus outbreak.