The United States and South Korea's Samsung cooperate to build a battery factory in the United States, with a joint investment of 3.5 billion dollars

Recently, South Korean battery manufacturer Samsung SDI and General Motors of the United States announced that the two sides have signed a contract and will jointly invest 3.5 billion dollars to build an electric vehicle battery joint factory in Indiana, the United States.

The factory is expected to start production in 2027. The initial annual production capacity target is 27 GWh. According to the expansion plan, the annual production capacity is expected to rise to 36 GWh. The factory covers an area of 680 acres and can create about 1,600 local jobs. The factory will focus on producing nickel, cobalt and aluminum batteries for General Motors' future electric vehicles.

Both the United States and South Korea have high hopes for this cooperation. Choi Yoon-ho, CEO of Samsung SDI, said that the two sides aim to “establish a high-end battery production center to lead the US electric vehicle market.” Mary Barra, chairman and CEO of General Motors, also believes that “with the construction of charging infrastructure and the expansion of market segments, the electric vehicle market and General Motors' sales will continue to grow.”

This cooperation is an important measure for South Korean battery manufacturers to further penetrate the North American market and is also in line with the current trend of automakers and battery manufacturers to invest in North America. Since US President Joe Biden signed the Inflation Reduction Act, the US government has launched a number of supportive policies to establish a local battery supply chain, attracting many enterprises to increase investment in the US battery industry. Previously, global large automakers such as Toyota and Hyundai have taken action one after another, and Tesla also plans to expand its battery factory in Nevada.

However, this cooperation also faces some challenges and uncertainties. For example, according to the US Inflation Reduction Act, in the cooperation with General Motors, Samsung SDI can receive a subsidy of up to 1.26 billion dollars. But there will be a general election in the United States in November this year, and the continuity of relevant policies after the election is unknown. In addition, although the United States vigorously supports the development of the local battery industry, in the battery field, its accumulation is not as deep as that of countries such as China, Japan and South Korea. Whether it can achieve its goal of establishing an independent battery supply chain remains to be seen.