LG Chem, LG's electric battery making subsidiary, has formed two joint ventures (JVs) with Huayou Cobalt in China for stable supplies of cobalt for making electric batteries.
The JVs will help produce enough electric batteries to power 400,000 high-performance electric vehicles (over 320 kilometers with one-charge), the company said.
One will produce precursors and the other anode materials. LG will invest 83.3 billion won for 49 percent shares on the precursor JV and 156.1 billion won on the company producing anode materials for 51 percent shares.
The precursors firm will be set up in Chuzhou, Zhejiang Province, and the anode materials at Wuxi, Jiangsu Province.
Operations will begin 2020 and each will produce 40,000 tons annually. This will be expanded to 100,000 tons a year once demand rises, LG said.
The materials will be delivered to LG's factory in Nanjing, China, which produces electric batteries for electronics, electric vehicles, and ESS, as well as the company's factory in Poland, which exclusively produces batteries for electric vehicles.
Huayou Cobalt last year produced 20,000 tons of refined cobalt and is the largest producer in the world.
LG Chem supplies smartphone batteries to sister firm LG Electronics and ESS batteries for Tesla. It is a major electric car battery supplier for global firms such as GM.
China is the biggest buyer of cars and the biggest promoter of electric vehicles. It is aiming to have 7 million electric vehicles by 2025.
Shenzhen is offering one-hour free parking to new energy vehicles registered to the city.
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