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How 2 South Korean Companies Have Managed to Terrify Ford, VW, and the Biden Administration
The stakes are so high that SK innovation will be forced to settle
This is a story of cutthroat technological war, unfathomable corporate animus, a new kind of economic nationalism, and great power competition between the two most powerful leaders in the world. The likelihood is that the rare drama will end in a settlement that could lay low one of South Korea’s most powerful companies. But before then, it is a nerve-wracking spectacle that reflects the newfound tension rife in international batteries and electric cars.
In a case involving two relatively unknown South Korean companies, the International Trade Commission (ITC) , on Wednesday, barred the import of batteries meant to power the new electric Ford F-150 pickup, the most popular line of vehicles in the country for four straight decades. The batteries, made by South Korean giant SK innovation (SKI), were also intended for VW’s new crossover SUV, called the ID.4, which the German carmaker has planned to make in the U.S. to compete with the Tesla Model Y. But now, both companies must find another battery.
The draconian ruling favors LG Chem, SKI’s blood enemy in the ruthless South Korean battery business. Their loathing is perhaps understandable: they are both at the very cutting edge of current lithium-ion technology, and competing for the lucrative business of the same global automakers in what is thought to be one of the most important future industries — electric vehicles. Both are also tinkering with the same chemistry — NMC, the go-to battery formulation for most electric vehicles—but have landed on different ways of pushing it to better performance.
On Twitter and elsewhere, the case has captured the attention of the battery and EV communities. A key issue raised has been the geopolitics— an impression, misguided in my view, that the case threatens President Joe Biden’s intention to get the U.S. fully into the global battery-making war. It has also highlighted the fierce contest among the automakers to be dominant in EVs. A primary reason for my own interest, though, has been the high stakes and naked ambition of the multiple parties.
