According to media reports, the negotiations between SK Innovation and LG Energy’s LG Energy Solution in a dispute over allegations that SK Innovation abuses trade secrets, led to a settlement.
These are not details yet, so we only rely on brief information:
‘Two South Korean electric vehicle battery makers have reached a final settlement in a bitter US trade dispute’, said people familiar with the deal are refusing to allow President Joe Biden to choose between undermining intellectual property rights or a politically toxic blow to its climate agenda. . “- Bloomberg
This is positive news, as SK Innovation’s EV battery business in the US was basically banned by the US International Trade Commission (ITC) (for a period of ten years (with some time limits), which could have a negative impact on the EV industry, including:
- Ford EV Program (Ford F-150 Electric)
- Volkswagen EV program (MEB-based EVs)
- SK Innovation’s $ 2.6 billion investment in two battery factories (total 21.5 GWh) at a Commerce, Georgia site:
- the first: 9.8 GWh is expected to be ready in 2021 (mass production from 2022). According to Bloomberg, it’s almost complete and is already making battery samples
- the second: 11.7 GWh scheduled for 2023
For sure it was not an easy chess game. According to previous media reports, SK Innovation was not willing to pay the amount demanded by LG Chem and he hoped that the government of President Joe Biden would reject the ITC ruling. The settlement was reached just before the 60-day period, which is available for eventual rejection.
Without the settlement or to reverse the ITC ruling, SK Innovation is likely to step out of the US battery business.
We guess that as long as LG Chem’s LG Energy Solution will be compensated for the ‘misappropriated trade secrets’ in a voluntary settlement, the story will have a happy ending.
Let us now wait for the official statement of all parties, and perhaps some details.