SK Innovation to start construction of second EV battery plant in US

South Korea's SK Innovation Co Ltd, a supplier for Volkswagen and Ford Motors, said on Tuesday it will spend $727m (roughly R13.53bn) to build a second electric vehicle (EV) battery plant in the US

It will begin construction of the factory in July and aim to start production in 2023, the company said in a statement.

It did not say where the factory will be located. At one time it had indicated that it may build a second plant in the state of Georgia.

It will make a further investment in its second US factory, bringing total spending to about $1.5bn (R27.93bn), an SK Innovation spokesperson told Reuters, but did not give a timeframe.

The company is currently building its first factory in the US, in Georgia, with a planned investment of 1.2 trillion won (roughly R16.81bn).

The 9.8-GWh factory will serve Volkswagen's EV base in neighbouring Tennessee, with production on track to begin in 2022.

The proposed second plant will have an annual capacity of 11.7GWh of batteries.

SK Innovation, South Korea's biggest oil refiner, has rapidly expanded into EV batteries, with factories in South Korea, China and Hungary.

The company is also currently involved in a legal battle in the US with its South Korean rival LG Chem Ltd. A win for LG Chem could stop SK Innovation importing EV batteries and components.

Researcher Wood Mackenzie this month forecast that global EV sales would drop 43% this year to 1.3 million vehicles because of the coronavirus outbreak, lower oil prices and a wait-and-see approach to buying new models.