The Joe Biden administration is determined to replace most of the country’s gas and diesel-powered vehicles with zero-emission electric vehicles (“EVs”), and recent developments in the battery-making space have brought the country a step closer to its goal. Two battery makers from South Korea — SK Innovation and LG Energy — had been involved in a feud that would have had lasting consequences on the American electric vehicle industry. However, the two companies recently announced that they have reached a settlement, a move President Joe Biden says is a big win for the United States.
In February this year, the International Trade Center (“ITC”) passed a ruling that SK Innovation had stolen trade secrets belonging to LG Energy Solutions regarding its EV battery technology. As per the ITC’s ruling, the United States government was ordered to bar SK Innovation from importing raw materials for its battery-making operations. At that time, SK Innovation had been constructing a massive $2.6-billion facility in Georgia, one of the largest economic projects in the state’s history.
The plant would have employed 2,600 workers and provided EV batteries for automakers Ford and Volkswagen. SK Innovation threatened to abandon the Georgia plant if the ITC’s ruling was not overruled, depriving the state of thousands of employment opportunities and forcing Volkswagen and Ford to source batteries for their electric vehicles elsewhere. In a worst-case scenario, the federal government would have had to disregard the ITC’s decision and allow the company to import raw materials to prevent America’s nascent electric vehicle industry from suffering a major blow.
Fortunately, the two South Korean companies reached a settlement shortly before the April 11 deadline that would have seen the government intervene and reverse the ITC’s ruling. SK Innovation will pay $1.8 billion in cash and royalties to LG Energy Solutions, and the two companies will not file any suits against each other for the next decade. Biden called the settlement a positive step in the right direction, stating that it will beef up the American electric vehicle supply chain and provide plenty of job opportunities for workers in Georgia.
According to a joint press release from LG Energy Solutions CEO Jong Hyun Kim and SK Innovation CEO Jun Kim, the two battery makers will compete amicably to help ensure the future of the American and South Korean EV battery sectors. With the current administration working towards electrifying the country’s roads, the two companies pledged to offer their support to Biden’s administration and help the country achieve a strong supply chain.
Now that this battery supply chain has been rescued from the threat of a premature end, it is game on between ev Transportation Services Inc. and other electric vehicle makers vying for a market share in the country.
NOTE TO INVESTORS: The latest news and updates relating to ev Transportation Services Inc. are available in the company’s newsroom at https://ibn.fm/EVTS
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