SK Nexilis spurs expansion in battery foil

A roll of copper foil produced by SK Nexilis. / Courtesy of SK Nexilis

SK unit exploring sites in US, Europe, Southeast Asia for more plants

By Nam Hyun-woo

JEONGEUP, North Jeolla Province ― SK Nexilis is expanding its production of copper foil for electric vehicle (EV) batteries, as part of the company's bid to capitalize on EVs' ascension in the global automotive market.

Betting high on the projected growth in demand, the SK Group unit has invested 240 billion won ($215.3 million) to add two new copper foil plants by 2022 at its production complex in Jeongeup, North Jeolla Province.

During a press tour of the complex Monday, the company said it is exploring additional sites for more plants in the U.S., Europe and Southeast Asia as part of its bid to become the world's top supplier of copper foil for EV batteries.

SK Nexilis, formerly KCFT, is one of the newest affiliates of SK Group, after advanced materials maker SKC purchased a full stake in KCFT for 1.19 trillion won earlier this year. To finance the acquisition, SKC sold a 49 percent stake in KCFT to Petrochemical Industries Company (PIC) of Kuwait to set up the joint venture SKCPIC.

The bold investment was interpreted as SKC's confidence in the growing demand for copper foil for EV batteries, and SK Nexilis' technical capability in producing quality products, which the company claims to be the world's thinnest, longest and widest.

SK Nexilis' copper foil plants in Jeongeup, North Jeolla Province. / Courtesy of SK Nexilis

Occupying 129,000 square meters in the city, the Jeongeup complex has four plants capable of producing 34,000 tons of copper foil a year. When plants five and six are completed in the second half of next year and first quarter of 2022, respectively, the company will be able to produce 52,000 tons of copper foil annually.

Copper foil is an electrolytic material used for the base layer of printed circuit boards, but there has been a spike in demand in recent years as the global car industry focuses on lithium-ion batteries as the main power source for vehicles.

Lithium-ion batteries have four core components ― anode and cathode materials, electrolytes and separators ― copper foil is used to coat anode material.

For copper foil makers, making thinner foil is their ultimate goal, because it reduces the battery cell's weight, thus allowing the cell to contain more anode material and improving overall energy efficiency. Wider and longer foil is also helpful for battery cell makers, because longer foil saves time in changing rolls and wider foil allows cell makers to coat more anode material at once.

Generally, most EV batteries use copper foil that is six to eight micrometers thick. But in October last year, SK Nexilis succeeded in mass-producing foil that was four micrometers thick at a width of 1.4 meters and a length of 30 kilometers, which the company said was a world first. When this is applied to cell makers, the total weight of copper foil in an EV will go down from the average 30 kilograms currently, and bring further improvements to cells' energy efficiency. One micrometer is equivalent to 0.001 millimeters.

At the plants, reporters were able to watch the four-step process of SK Nexilis making copper foil. The first process involved dissolving high-purity copper scraps ― mostly recycled copper wire ― in sulfuric acid and mixing additives to give specific properties such as tensile strength and elasticity.

The mix was then processed into copper foil by being electroplated onto large, spinning titanium drums. The finished foil was wound into mother rolls that were then slit into desired sizes and lengths. As those processes were highly automated, this reporter was able to see only a handful of engineers supervising production.

Kim Ja-seon, SK Nexilis' copper foil manufacturing team leader, shows a sample of the company's four-micrometer thick foil for electric vehicle batteries during a press event at the company's plants in Jeongeup, North Jeolla Province, Monday. Courtesy of SK Nexilis

The finished products are supplied to battery cell makers around the world, including LG Chem, Samsung SDI, SK Innovation, CATL and Panasonic. Buoyed by the surge in demand, SK Nexilis' total foil shipments reached a record high of 2,600 tons in September, up 1,000 tons from last year's monthly average, while third-quarter sales surpassed 100 billion won for the first time to stand at 103.1 billion won.

Though the company did not reveal market share data on EV battery copper foil, it assumes it is one of the world's top players, along with CCP of Taiwan, Lingbao Wason of China and fellow Korean company ILJIN Materials.

“When plants five and six are completed, we assume SK Nexilis' Jeongeup base will be the largest EV battery copper foil plant in the world,” SK Nexilis Chief Managing Officer Yi Jae-hong said, adding the company is exploring overseas sites for further expansion.

“In terms of cost, Southeast Asia has the advantage, given electricity rates account for the majority of our cost structure. Europe and the U.S. have advantages in accessibility to our clients.”

Yi said the company will likely come up with investment decisions by the end of this year, but he refused to confirm a timeline for additional plants in Europe or the U.S.