WASHINGTON (AP) – Two major South Korean electric vehicle battery makers said Sunday they have resolved a lengthy trade dispute that will allow a company to move forward with plans to make batteries in Georgia. President Joe Biden called it “a victory for American workers and the American auto industry.”
The agreement between LG Energy Solution and SK Innovation put an end to the need for Biden to intervene in a case monitored for its implications on Biden’s clean energy agenda, which includes a sharp increase in the number of electric vehicles as part of its plan to address climate change. . Biden had until Sunday night to make a decision, following a February ruling from a trade commission.
The companies said in a joint statement that SK will supply LG Energy with a total of $ 1.8 billion and undisclosed royalties. They agreed to withdraw all pending trade disputes in the United States and South Korea and not to assert new claims for ten years.
“We have decided to establish ourselves and compete in a friendly way, all for the future of the electric vehicle battery industries in the United States and South Korea,” said Jun Kim, CEO and President of SK, and Jong Hyun Kim , CEO and President of LG Energy.
The companies pledged to work together to strengthen the EV battery supply chain in the U.S. and support the Biden administration’s efforts to advance clean energy policies, including electric vehicles.
The U.S. International Trade Commission had ruled in February that SK had stolen 22 trade secrets from LG Energy and that SK should be banned from importing, manufacturing or selling batteries in the United States for ten years.
The decision could have left Ford and Volkswagen looking for batteries, as both launched additional electric vehicle models, a priority for companies and the Biden administration. SK has contracts to manufacture batteries for a Ford F-150 electric van and a Volkswagen electric SUV.
The commission said SK could supply batteries to Ford Motor Co. for four years and for Volkswagen AG for two years. The decision had jeopardized a $ 2.6 billion battery factory that SK is building in Commerce, Georgia.
Democratic Sen. Jon Ossoff of Georgia, who at Biden’s request began negotiations between two companies, said the deal “has saved the battery plant in Commerce, Georgia, by guaranteeing thousands of jobs, billions in future investments, and that Georgia will be a leader in the production of electric vehicle batteries for years to come. “
U.S. Trade Representative Katherine Tai said the deal “builds confidence” in the reliability and responsibility of the two companies as suppliers to the U.S. auto industry. The agreement places the U.S. “in a stronger position to drive innovation and clean energy technology, while respecting the rights of technological innovators at the heart of trade and manufacturing policy,” Tai said.
Added Senator Raphael Warnock, D-Ga .: “The best way to protect trade workers – and the jobs promised to Georgians – is for the companies involved to negotiate a good faith agreement.” He said he raised the battery issue with Biden during the president’s March 19 visit to Atlanta.
Biden said in a statement that the construction of electric vehicles and batteries necessary for them is an important part of their $ 2.3 trillion infrastructure plan.
“We need a strong, diversified and resilient US-based electric vehicle battery supply chain so we can meet the growing global demand for these vehicles and components: create well-paid jobs at home and lay the groundwork for tomorrow’s jobs. Today’s agreement is a positive step in that direction, “Biden said.
Gov. Brian Kemp, R-Ga., Called the settlement “fantastic news for northeastern Georgia and our state’s growing electric vehicle industry.”
Ford said in a statement that the agreement “allows us to focus on supplying a range of world-class Ford battery electric vehicles to our retail and fleet customers, while supporting American workers.” to the economy and to our shared goal of protecting the planet. “
___
Krisher reported from Detroit.