SK On expanding to prismatic EV batteries, seeking turnaround with diversification; positive.

From Investing.com: 2024-07-12 19:27:57

South Korean EV battery maker SK On is expanding to prismatic batteries amid slowing global EV demand, in talks with automakers for supply deals. The company already produces pouch-type batteries for Ford, Hyundai, Volkswagen. SK On aims to diversify its product portfolio and possibly develop cylindrical-type batteries like Tesla’s.

SK On has completed prismatic battery technology and plans to start production once discussions are finalized. The company, a unit of SK Innovation, has never made a profit since splitting from SK Innovation in 2021. SK On is not considering cutting research and development spending despite its capital expenditure budget for the year.

SK Innovation’s rival LG Energy Solution is minimizing capital expenditure due to slowing EV demand. LGES recently paused construction on a battery factory in Arizona. SK On plans to break even in the second half of the year and is implementing expense cuts, including a freeze on executive salaries. SK Innovation may pursue a merger with SK E&S to support SK On.

SK Innovation will hold a board meeting next week to discuss strategic measures, including possible mergers. The company has not made any decisions yet. The parent company reported a capital spending budget of about 9 trillion won for the year, with SK On receiving the majority of the allocation.



Read more at Investing.com: South Korea’s SK On in talks to supply prismatic EV batteries as it seeks turnaround By Reuters