SK On plans to manufacture prismatic EV batteries

Sk On, the South Korean EV battery maker is in discussion with EV's  Orignal Equipment Manufacturers (OEMs) for the production of prismatic batteries, further widening its offering from pouch-type batteries, a senior executive reported. 

The update came as the company took cautious treads amid the worldwide decreasing demand for EVs.

According to SK On chief spokesperson Ko Chang-Kook, several automakers are in talks with SK On, a division of energy group SK Innovation, which provides electric vehicle batteries to Volkswagen, Ford Motor and Hyundai Motor among others.

"We are in discussions with automakers who plan to use our prismatic batteries, which means we will soon have the chance to expand the range of products we provide." citing Ko Reuters reported

Although Ko would not name the automakers, he did say that the business has completed the development of technology for prismatic batteries and is ready to begin producing it as soon as negotiations are concluded. Currently, three different types of lithium-ion batteries are utilised in electric vehicles (EVs): prismatic, cylindrical, and pouch-type. While they all function essentially the same way, each type has advantages and disadvantages.

Batteries, both cylindrical and prismatic, are housed in sturdy cases. However, the pouch kind of battery employs sealed flexible foils. Only pouch-type batteries for EVs are currently produced by SK On. Despite having obtained prismatic battery technology, the company is also aiming to create cylindrical batteries, which are well-known for being the kind that Tesla uses.  

When asked whether the company is planning to cut capital expenditure due to continuous losses,  Ko responded that SK On is not currently considering cutting its capital expenditure for the year, adding that it will not cut research and development spending. 

The parent company of SK On, SK Innovation, announced earlier this year that it has earmarked almost 80% of its annual capital spending budget of over 9 trillion won ($6.55 billion) for SK On. As EV demand declines, crosstown competitor LG Energy Solution (LGES) said in April that it intends to reduce capital spending this year. In order to improve its operations, LGES suspended a portion of the building of its multibillion-dollar battery factory in the U.S. state of Arizona last month. The company plans to execute planned investments at a flexible pace.

SK On stated in April that it remained on course to achieve break-even in the second part of this year. This month, the corporation said that it would freeze the wages of all executives until the company generates a profit, among other general expense reductions. 

According to reports from local media sites, SK Innovation is anticipated to look into merging with SK E&S, a successful gas affiliate, in order to support SK On.

Although nothing has been finalised, SK Innovation announced in a regulatory filing on Friday that it would meet with its board on Wednesday of next week to explore a range of strategic initiatives, including mergers to bolster its competitiveness.