Electric vehicle battery supplies may be delayed due to feud between two Korean manufacturers

Supplies for electric vehicle (EV) batteries to some of the world’s biggest carmakers may risk a delay if the feud between two Korean EV battery manufacturers is not settled soon.

Lawsuits that have been filed and counter-filed by EV battery manufacturing companies LG Chem Ltd. (LGC) and SK Innovations (SKI), both based in Korea, may put the supplies for EV batteries at risk.

Volkswagen (VW) built its EV manufacturing plant in the US in Chattanooga, TN and this plant will be its EV hub in the US. 

In March of this year, SKI built its $1.7 billion EV factory approximately 125 miles away in Commerce, GA. LGC feeling left out of the picture and after having lost 77 of its employees to SKI, accused SKI of misappropriating trade secrets and filed a lawsuit against SKI in the US in April of this year.

Now, seven months later, the two EV battery manufacturing businesses have hit each other with US lawsuits for battery patent infringement in a bitter battle that may disrupt the launches of EVs by VW, Ford, GM, Audi, Jaguar and KIA Motors. Reuters has reviewed US court filings which show that the two feuding businesses are trying to stop each other from importing and selling their EV batteries to these world renowned car manufacturers.

According to the court filings and several industry experts, at stake is the ability for the two Korean firms to supply these automakers with EV batteries at a time when the automakers are scrambling to lock in supplies with lucrative contracts ahead of the expected surge in demand.

Unless the two Korean firms reach a settlement out of court, whoever loses the battle will suffer a fatal blow and it will also cause a setback for automakers, says Cho Jae-phil, who previously worked at another Korean rival, Samsung SDI and who is now currently a professor at Ulsan National Institute of Science and Technology located in Ulsan, South Korea.

However, Ford believes there is sufficient demand for multiple EV battery suppliers to provide all the EV batteries that will be needed by auto manufacturers worldwide and according to its spokesperson, Jennifer Flake, is encouraging LGC and SKI to resolve its dispute without litigation. Ford’s statement was released in an email sent to Reuters.

Flake says the company has plans in place for the continuity of is business and to protect its interest which is a normal course of action.

GM also said it was aware of the dispute and at this time it did not expect any impact on its production of its Chevy Bolt, EV. Other EV manufactures declined to make any comment to Reuters concerning the matter.