Battery supply ruling complicates future for F-150 Electric, VW ID.4

A Wednesday decision by the U.S. International Trade Commission (ITC) potentially places thousands of jobs and, perhaps, the rate at which some electric vehicles arrive, in jeopardy—if two rival South Korean battery suppliers don’t reach a settlement.  This latest row started in 2019 with allegations from rival South Korean battery maker LG Chem, which sued […]

A Wednesday decision by the U.S. International Trade Commission (ITC) potentially places thousands of jobs and, perhaps, the rate at which some electric vehicles arrive, in jeopardy—if two rival South Korean battery suppliers don’t reach a settlement. 

This latest row started in 2019 with allegations from rival South Korean battery maker LG Chem, which sued SK Innovation alleging it had misappropriated LG Chem trade secrets through the hiring of former employees in the ramp-up of factories in Georgia (U.S.) and in Hungary. 

The ITC voted to effectively ban the electric vehicle battery supplier SK Innovation from the U.S. market. In its notice of the final determination, the ITC issued “cease and desist orders prohibiting importation of certain lithium ion batteries, battery cells, battery modules, battery packs, and components thereof.”

Ford F-150 Electric prototype teaser

Ford F-150 Electric prototype teaser

The decision, which follows a preliminary ruling from February 2020, sets a duration of 10 years for the ban and has a couple of noteworthy exceptions. Ford will be able to use the company as a battery supplier for four years for its F-150 Electric, and Volkswagen for two years for Tennessee-built electric vehicles starting with the ID.4. SK Innovation is also allowed to supply repairs and replacements. 

“This ITC decision supports our plans to bring the all-electric Ford F-150 to market in mid-2022,” Ford said in a statement to Green Car Reports. “Providing this zero-emissions, purpose-built truck for our customers is an important part of our plan to lead the electric vehicle revolution and is a top priority for the company.”

The company currently supplies cells for several Kia models—including the Niro EV, although those are sourced from South Korea.

SK Innovation said that because of the decision it will immediately enter into discussions with Ford and Volkswagen—and it confirmed that makes the fate of the Georgia plant uncertain. 

Artist's rendering of SK Innovation battery factories in Commerce, Georgia

Artist’s rendering of SK Innovation battery factories in Commerce, Georgia

The implications are far beyond the F-150 and ID.4. SKI said last year that the Georgia plant would be making batteries for about 300,000 EVs annually. LG Chem has a much smaller facility in Holland, Michigan, and a new joint-venture plant with GM in Ohio. 

“We have serious concerns about the commercial and operational implications of this decision for the future of our EV-battery facility in Commerce, Georgia, which is expected to employ 2,600 people when soon completed,” SKI said in a statement provided to Green Car Reports. 

Meanwhile, President Biden has pushed toward more electric vehicles and a higher level of domestic content in vehicles—something that is likely at odds with the decision. 

“Our facility in Commerce will add thousands of new jobs up and down the supply chain in the region,” added SKI Thursday. “We are hopeful that the Biden administration will take seriously the negative economic and environmental impact of this decision and reverse it so that we can continue to operate. We know that EV battery production is increasingly viewed a part of the critical national security infrastructure and domestic production of these batteries is a top priority.”

An LG Chem official told Reuters that the company was open to settlement talks with SK Innovation.