LG Energy signs multi-billion-dollar LFP battery deal with Renault

By Hyung-Kyu Kim, The Korea Economic Daily - LG Energy Solution Ltd., the world’s second-largest battery maker, has clinched a multi-billion-dollar deal to supply LFP batteries for low-end electric vehicles to Renault Group’s EV unit Ampere.

The South Korean battery maker said on Tuesday the two sides signed the deal at Renault’s headquarters in Paris on Monday, attended by executives, including Suh Won-joon, executive vice president and head of the advanced automotive battery division at LG, and Josep Maria Recasens, Renault Group’s chief strategy officer and Ampere’s chief operating officer.

Under the five-year contract, LG will provide LFP, or lithium ion phosphate, batteries to Ampere from late 2025 through 2030, with a total capacity of some 39 GWh, enough to produce 590,000 battery EVs.

The batteries, to be manufactured at LG Energy’s Poland facility, will power Ampere's next-generation EV models.

The deal’s value wasn’t known, but industry watchers said it would be trillions of won, or multi-billion dollars.

“We will provide the best customer value to Ampere through our overwhelming technological prowess and quality,” said LG Energy’s Suh.

François Provost, Renault’s chief procurement, partnership and public affairs officer said: “We worked hand in hand with LG to set up an integrated value chain in Europe. Our long-term relationships have enabled us to build this unique solution in terms of technology and competitiveness.”

KOREA’S FIRST MEGA-DEAL BEATING LFP SUPER POWER CHINA

LG said the latest deal represents its and Korea’s first large-scale LFP battery supply deal in Europe, one of the world’s fastest-growing EV markets.

Korea’s three major battery makers – LG Energy, SK On Co. and Samsung SDI Co. – have concentrated on expensive nickel-cobalt-manganese (NCM) cells. However, they are now shifting gears to produce low-end LFP cells on growing demand from Tesla Inc. and other major EV makers.

LFP batteries are mostly made by Chinese companies, including Contemporary Amperex Technology Co. Ltd. (CATL), the world’s top battery maker, and BYD Co.

LFP cells are lower in energy density but cheaper to make compared to other types such as NCM batteries, and thus more suitable for low-end EV models. LFP batteries are also more stable, meaning less vulnerable to fire.

LG Energy has switched part of its energy story system (ESS) production lines at its plant in Nanjing, China to produce LFP batteries with a plan to begin mass production in 2025.

CELL-TO-PACK SOLUTIONS

LG said it is providing Renault’s pure EV player Ampere with pouch-type LFP batteries made with cutting-edge cell-to-pack (CTP) manufacturing technology.

CTP refers to a technology that bypasses the module stage to make cells into a pack structure. Compared with the general battery structure, the module-free structure reduces weight and manufacturing costs and increases space utilization, according to LG.

LG said it is the industry’s first to apply the technology to pouch-type batteries.

CTP-applied pouch-type batteries boast about 5% higher energy density per weight compared with prismatic CTP tech batteries. LG said it has also enhanced battery safety by increasing the toughness of the battery pack and applying heat transfer prevention technology.

LG’S EXPANDED BATTERY PORTFOLIO

With the latest supply deal, LG has expanded its product portfolio in pouch-type batteries encompassing various chemistries such as high-nickel NCMA, high-voltage mid-nickel NCM and LFP.

LG said a wide range of products will allow it to serve various consumer needs from premium EVs to more affordable entry-level segment vehicles.

“Through this partnership with Ampere, our unrivaled product competitiveness and differentiated customer value have been recognized once again,” said LG Energy Chief Executive Kim Dong-myung.

The CEO, also known in the West by his English name David Kim, said: “Starting with the European market, we will keep expanding our supply of automotive LFP batteries.”

LG is also an active battery player in the US, where it operates its own battery plants and a joint venture, Ultium Cells LLC, with General Motors.

Source: https://www.kedglobal.com/batteries/newsView/ked202407020005 

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