Unnamed LG Chem researchers in the United States examine lithiumion battery packs used in GM’s Chevrolet-branded electric vehicles, Tuesday.
/ Courtesy of LG Chem
By Kim Yoo-chul
LG Chem, Korea’s top chemicals maker, has secured another springboard to further boost its growing battery business through another lucrative deal to develop a self-contained lithium-ion battery pack for electric vehicles in the United States.
The news comes after LG Chem chief executive Kim Bahn-suk spoke positively about achieving 300 billion won in revenue in batteries for electric vehicles this year.
On Tuesday, the United States Advanced Battery Consortium (USABC), an organization whose members are Chrysler, Ford and General Motors, awarded LG a $9.6 million contract to develop advanced battery technology in Troy, Mich.
This is the fourth time LG Chem has won a contract with USABC since landing a similar project in 2004 that was worth $4.6 million.
The latest deal is for LG Chem, one of LG Group’s critical earnings drivers, to develop a thermally-managed battery system for plug-in hybrid electric vehicle applications by the end of 2013.
The project is to be co-funded by the U.S. Department of Energy (DOE) and includes a 50 percent cost share by LG Chem, the firm said in a statement.
``This is significant because LG Chem has found ways to surpass its rivals for the development of next-generation battery application systems used in electric vehicles in the growing market,’’ said Sung Hwan-doo, a senior LG spokesman.
The program is aimed at making firm strides toward achieving USABC’s goals of 64-kilometer battery pack system performance requirements, while also driving down the cost to $3,400.
``Chances are high that LG Chem will also be better positioned for further business deals with leading U.S.-based automakers if the project yields positive results,’’ said Sung.
The battery business is regarded as a new cash-cow for LG, whose key businesses are still dependent upon volatile petrochemical-centric ones. LG aims to reap 4 trillion won from batteries alone by 2015, accounting for 25 percent of the global market.
The South Korean company has secured 10 leading automakers as clients and has been building battery plants in Ochang and Holland, Mich. in an apparent strategy to boost shipments.
``The program is essential to advance both near- and long-term goals that will enable a broad spectrum of vehicle electrification and make electrified vehicles increasingly affordable,’’ said Steve Zimmer, executive director of USCAR.
USCAR is the collaborative automotive technology company for Chrysler, Ford Motor and GM.