Ford, VW warn about Korean companies’ battery dispute

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SEOUL — Volkswagen Group and Ford Moto Co. said a U.S. legal dispute between South Korean battery makers could disrupt supplies of the key electric vehicle parts and cost U.S. jobs during the COVID-19 outbreak, according to documents submitted to a U.S. trade panel.

The two automakers asked the U.S. International Trade Commission to allow SK Innovation to manufacture batteries at its proposed U.S. factory in Georgia for use in Ford’s full-electric F-150 and other electric vehicles, the statements seen by Reuters showed.

Last year, South Korean battery maker LG Chem sued rival SK Innovation over alleged trade secret theft in the U.S., seeking to bar SK from producing battery cells in the U.S. and importing the components necessary to make the cells.

“Any remedial orders should seek to avoid collateral damage to SKI’s existing customers,” Volkswagen said in its public interest comments to the ITC in May.

“To avoid a catastrophic supply disruption,” the commission should allow SK Innovation to manufacture EV batteries in the U.S. facility, VW said in the May statement.

LG Chem declined to comment, citing ongoing litigation.

Ford said that LG Chem’s assertion that it can replace SK Innovation as a supplier is not “credible” given EV battery supply shortages and the long development period required for EVs.

LG Chem, which plans to build a battery factory with GM in Ohio, secured backing from Ohio’s governor, who said the ITC needs to “remedy SKI’s unfair competition,” the documents, dating from May and seen on Tuesday showed.

He said a failure to do so could threaten investment by LG Chem and GM that will “will bring manufacturing jobs back to the United States, ultimately employing around 1,100 American workers”.

“SKI is accused of stealing LG Chem’s intellectual property and using it to directly compete against workers in Ohio,” Ohio governor Mike DeWine said in a statement to the ITC in May.

SK Innovation is building its first battery plant in Georgia to serve VW’s EV base in Chattanooga. Tenn. Production of the ID4 electric vehicle is scheduled to begin there in 2022.

SK also plans to add a second U.S. plant to supply Ford’s electric pickup trucks and other models.

“The risk to such U.S. jobs is especially unacceptable in light of current economic conditions caused by COVID-19,” Ford said in its public interest comments to the ITC.

This year, the ITC preliminarily ruled in favor of LG Chem, dealing a blow to SK Innovation. The ITC is set to make a final ruling in the case on Oct. 5.

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Saurabh Shukla

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