Samsung SDI starts constructing EV battery plant in Hungary
By Lee Min-hyung
Samsung SDI has started building a new battery plant in Hungary to speed up its supply for European automobile clients.
The world’s top-tier battery maker said Tuesday the project is expected to be finished by the end of 2018. The company plans to invest a total of 400 billion won ($357 million).
The decision to build the plant comes as the demand for electric vehicles (EV) is growing and more automakers are tapping into the promising, eco-friendly sector.
Samsung SDI said the European plant will have an annual battery production capacity for 50,000 EVs. It will give the company three manufacturing facilities across the world -- including those in Korea’s southeastern port city of Ulsan and Xian in China.
The new plant will help Samsung SDI generate synergies with its battery pack plant in Austria. The facility belonged to auto parts supplier Magna before Samsung SDI Battery Systems acquired a 100 percent stake in Magna’s battery pack division last year.
“The new plant in Hungary is expected to help Samsung SDI strengthen its foothold in the battery business, allowing us to manufacture not just battery cells, but packs seamlessly for our clients in Europe and other countries as well,” a Samsung SDI spokesman said.
Samsung SDI’s European clients include BMW, Volkswagen, Jaguar and Land Rover.
Samsung SDI executives met Hungary’s Foreign Affairs and Trade Minister, Peter Szijjarto, Tuesday, at the nation’s government complex to announce the plan. The Hungarian government has pledged its support for the new facility.
Jeong Seh-woong, vice president at Samsung SDI, said: “The new factory will allow us to have three major manufacturing systems for batteries used for EVs.”
He said the factory is expected to generate synergies with SDI Battery Systems in Austria, meeting diverse and growing demand from its European clients.
Meanwhile, the global EV market will be worth some 20.7 trillion won in 2020, growing rapidly from about 3.7 trillion won in 2013, according to Tokyo-based market researcher B3.
As more automakers understand the importance of the EV industry, global IT companies and parts suppliers are tapping into these next-generation revenue sources. With EVs gaining popularity, Samsung SDI previously unveiled a plan to invest some 3 trillion won into its battery business for EVs by 2020.