President Joe Biden during remarks on the US Employment Plan in the South Court Auditorium in the Eisenhower Executive Office building on April 7, 2021.
Demetrius Freeman | Washington Post | Getty Images
On Sunday, President Joe Biden said the agreement between two Korean battery makers was a victory for US efforts to build a strong supply chain for electric vehicles, create clean energy jobs and stop climate change.
Resolving a trade dispute between LG Energy Solution and SK Innovation Co. will allow two factories in Georgia to move forward with plans to produce lithium-ion batteries for Ford and Volkswagen.
The companies agreed to drop litigation in the US and South Korea and not pursue further litigation for a decade. SK Innovation will also pay LG Energy Solution $ 1.8 billion in cash and royalties.
The agreement came before the Biden administration’s deadline on Sunday evening to reverse the decision of the International Commission on International Trade, unless the battery manufacturers reached a solution.
The agreement is a major gain for the Biden administration, which recently unveiled a comprehensive infrastructure plan that includes $ 174 billion in spending to boost the electric vehicle market and move away from gas-powered cars.
“We need a strong, diversified and resilient US electric vehicle battery supply chain so we can supply the growing global demand for these vehicles and components – creating well-paid jobs here at home and laying the groundwork for jobs. work tomorrow, “Biden said in a statement.
The president’s proposal involves installing at least 500,000 charging stations across the country by 2030, incentives for Americans to purchase electric vehicles and money to reorganize factories and increase domestic supply of materials.
Failure to resolve the dispute could have cost thousands of jobs in Georgia and threatened the country’s EV market, which accounts for about 2% of new car sales.
ITC ruled in February that SK Innovation had stolen trade secrets related to EV batteries and ordered the US to block the company from importing consumables to build batteries.
SK Innovation has threatened to abandon the $ 2.6 billion plant in Georgia – which is under construction and could employ 2,600 workers – unless the ITC decision is overturned. If no solution is reached, the Biden administration may have had to cancel the ITC to allow SK Innovation to build the plant.
“Today’s agreement is a positive step in that direction, which will bring a welcome relief to workers in Georgia and a new opportunity for workers across the country,” Biden said.
Jong Hyun Kim, CEO of LG Energy Solution, and Jun Kim, CEO of SK Innovation, said in a joint statement that the companies will “compete amicably, all for the future of the electric vehicle battery industries in the US and South Korea. . “
“We are dedicated to working together to support the Biden administration’s climate agenda and to develop a robust supply chain in the United States,” they said.