The LFP batteries, which can be produced at a lower cost than nickel-cobalt batteries but have a shorter range, will initially be sourced from China. SK On plans to have 150 gigawatt-hours of capacity in its new U.S. battery plants by 2026 and expects to meet domestic content requirements for EV subsidies through these investments and investments in U.S. cathode production. The company is considering raising additional capital to fund these investments and developing new chemistries.
Automakers Show Interest in SK On's LFP Batteries
SK On's plans for a lithium-iron-phosphate (LFP) battery have garnered interest from several automakers. Ford Motor Co has announced plans to offer Chinese-made LFP batteries from CATL in its electric Ford F-150 Lightning truck next year, and Tesla and EV startup Rivian have also expressed interest in using LFP batteries.
While Chinese battery makers currently dominate global LFP production, SK On's LFP batteries made in Europe have a 15% cost advantage over nickel-cobalt batteries. The company is working to address the challenge of raising the capital necessary for its capacity expansion and new chemistry development.
