The leading South Korean conglomerates guaranteed that they would invest around 45 trillion won ($40 billion) to the US, further building bilateral economic relations. During South Korean President Moon Jae-In’s US state visit, the accompanying companies announced they would play a critical role in facilitating the US supply chains. In particular, they would beef up supply chains in key sectors, including semiconductors and electric vehicle (EV) batteries.
Revitalizing Manufacturing Capacities
Since the transition to the digital era continues to accelerate, the importance of innovative technologies continues to escalate accordingly. The US administration currently seeks to revitalize its manufacturing capacity amid the global chip shortage and potential EV battery crisis. As a result, the South Korean companies made investments to aid the US in securing stable high-tech component value chains. It is also a win for the domestic companies, for they would acquire increased market shares and stronger global footholds.
“We have agreed to work closely to establish a stable supply chain in cutting-edge manufacturing sectors,” said President Moon. He also specified these manufacturing sectors would include EV batteries, semiconductors, and even medical supplies. Additionally, President Moon voiced his trust that the two countries’ synergy would further advance the global digitalization movement.
The four conglomerates that would participate in the project include Hyundai Motor Group, LG, Samsung, and SK Group. Previously, Hyundai Motor shared that it would provide 8.4 trillion won ($7.4 billion) for various US operations by 2025. Under the investment, Hyundai would focus on mobility solutions, including autonomous driving, EVs, facility enhancements, hydrogen cars, robotics, and more.
Korea’s Leading Conglomerates
Samsung Electronics Co. would inject 19 trillion won ($17 billion) in building a new chip foundry plant in the US. During the South Korea-US roundtable, Samsung Electronics Vice Chairman said that Samsung would significantly push both countries’ economic growth. Although the company remains uncertain regarding the plant site, it continues to discuss with key local government officials.
Meanwhile, LG Energy Solution and SK Innovation would invest a combined 15.7 trillion won ($14 billion) to numerous US projects. After resolving their long-standing battery tech dispute in April, the two companies are now ready to take on joint operations.
Furthermore, LG Energy Solution would collaborate with the US-based GM to build their second battery cell manufacturing factory. This factory’s 70GWh production capacity would notably power more than 1 million EVs per year. LG Energy Solution also plans to establish another plant with a 70GWh annual production capacity in partnership with GM. To this end, it would provide an additional 5 trillion won ($4.4 billion) investment.
Similarly, SK Innovation’s strategic 6 trillion won ($5.3 billion) joint venture with Ford Motor would boost the US EV rollout. SK Innovation had previously funded 3 trillion won ($2.6 billion) to establish an EV battery factory in the US. The battery company also revealed its plans to build another EV battery factory. This new investment would increase SK Innovation’s plant production capacity to 21GWh per year, powering over 300,000 EVs yearly.
Another SK affiliate, SK Hynix, would invest 1 trillion won ($1 billion) in establishing an R&D facility in Silicon Valley. The center would mainly focus on AI technologies and NAND solutions.
Check out other must-read articles from KoreaTechToday:
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- LG Energy Solution, GM Expands EV Battery Manufacturing Capacity
