LG Chem, one of the largest chemical companies in South Korea, is considering building an electric car battery plant in China.
LG Chem believes that the Chinese government will take measures to reduce pollution, which will increase market demand for electric cars.
LG Chem has produced batteries for electric cars made by GM and Renault. Jin-Soo Park, chief executive officer of LG Chem, said that in a short period, the number of its clients will be increase to 20. He said they are considering building an electric car battery plant in China and this is in line with the market demand.
At present, LG Chem has a factory in Nanjing, Jiangsu province, which makes batteries for smartphones and other mobile devices. Park said for the location of their future battery plant, the company will not be limited to Nanjing, but also will consider other cities in China.
The Ministry of Finance of China announced in February 2014 that they will extend the period of subsidies for electric car buyers. The current subsidy policy will expire in 2015. The Chinese government aims to increase the number of new-energy cars to 500,000 by 2015 and to five million by 2020. New-energy cars include full electric cars and hybrid automobiles.
Samsung SDI, a competitor of LG Chem, previously announced in January 2014 that the company will invest USD600 million to set up a joint venture in Xi'an to make electric car batteries. The joint venture will also develop other businesses related to electric car batteries over the next five years.