LG Chem – Lithium ion batteries for the electric vehicles revolution

LG Chem plans to increase capacity to about 60 million cells annually by 2013. LG Chem has the world’s largest facility that produces lithium-ion polymer batteries for electric vehicles and has signed supply contracts with major automotive companies, including General Motors and Ford.

With the 57,000 square meter (613,543 square feet) EV battery production facility in Ochang, LG’s annual capacity of 8.5 million cells is the world’s first and largest production line. LG said that this is only the beginning as they are in the process of building a 67,000 square-meter (721,182 square feet) plant next to the first one.

LG said it will invest 1 trillion won ($886.5 million) in the Ochang facility by 2013, and $300 million in its Holland plant in Michigan, as it plans to increase overall capacity ten-fold to about 80 million cells annually. That includes 60 million in Korea and 20 million in Michigan.

The Ochang production facility is one of the most technologically advanced and automated in the world. “The reason we were able to sign deals with companies like GM, Ford, Volvo, and Renault, is we copy nobody’s technology, but lead the market with our own,” said Kim Myung-hwan, senior vice president of LG Chem’s Battery Research & Development.

“Other companies and ventures may come up with wonderful products in their labs, but when it comes to mass production, it will be a whole different story as things will require a much higher output and [level of] safety,” he added.

Kim said that with over 10 years of experience in electric vehicles batteries, LG holds the world’s leading technologies, the best materials, the safest products and sees no competitors on the horizon. LG currently holds eight deals with leading automakers around the world.

The company’s electric car battery business is currently aiming for 1 trillion won in sales by 2013 and 3 trillion won by 2015. The company’s position in the industry is the result of its R&D department’s work over the last decade.

When Japanese companies were showing strength in nickel hydride batteries, LG focused on lithium-ion batteries and made further developments concentrating on EV batteries. Such developments have allowed the company to improve its production efficiency by 30 percent compared to competitors.

Also, being a chemical company with employees from various backgrounds and fields of study, LG said it is able to make better products with its own technology.

A good example of its technological prowess is its safety-reinforced separator technology, or SRS, which separates the cathode and the anode of the battery to allow effective flow of power. In an experiment which took place at LG Chem’s Research Park, when exposed to a temperature of 180 degrees Celsius (356 degrees Fahrenheit) for over 1 minute, regular batteries deformed and turned black, but LG’s batteries with the SRS technology maintained their original form.

“Our EV battery, which is protected by our SRS technology that we hold the patent to, is not a can type, but a pouch type, giving no dangers to explosions, and also holds a longer battery life,” said Kim. “Our competitors in and out of the country are using our SRS technology, thinking that we would not know about this, but such infringements will become an issue.”

LG’s SRS technology protects the battery in a layer of nano-scale ceramic particles and polyolefin film, since the battery can explode or show poor performance if the separator becomes torn. LG said at an international forum about two years ago that when it first came up with the idea, everyone was wondering why the company would want to spend more money on such a thing. However, LG stated that safety was one of its most important issues, along with quality and performance.

The company also holds a unique technology called stack and folding, which stacks the cathode, separator and anode and folds into a tight shape, preventing any kind of performance loss or deformations that competitors with winding methods showed.

“As a chemical company, we have the strength of producing our own material and lower costs in production, meaning that we have safety, performance, better price and competitive power, having everything that an EV battery should have,” said Kim.

The company said that it is currently in the process of developing technology that will allow a vehicle’s range to triple and battery price to fall to one third of what it is now. Confident in all aspects, LG is focusing on the competition for a better battery.

Local competitor SB LiMotive, which is a joint venture between Samsung SDI and Bosch, started things off by signing deals with BMW and Delphi, and recently announced a deal with Chrysler to power the Fiat. But SK Energy, who also claim to be in competition with LG and said they would announce surprising deals soon, has not been able to follow through with its promise. Its most recent deal to power Hyundai Motor’s BlueOn does not involve mass production, which the Volt and Focus offer in the market.