According to Yonhap News,

(SEOUL=Yonhap News) The Nikkei reported on June 19 that Sumitomo Chemical, a Japanese chemical company, will build a plant in Korea to produce separators, the key component of lithium-ion batteries.

Sumitomo Chemical will invest JPY 8 billion - 9 billion (USD 64.7 million - 72.8 million) in the plant to begin operations in 2017. The expected production capacity is 70 million㎡ per annum, accounting for about 10 percent of the global demand.

Sumitomo Chemical decided to establish a production plant in Korea due to the country’s strong production infrastructure and capability to supply raw materials.

The plant is also part of the company’s strategy to expand its electric vehicle-battery business to other regions, as the tariff on automobile parts has been lifted in Korea thanks to the free trade agreement between Korea and the United States, according to the Nikkei.

Sumitomo Chemical hopes to supply its separators to the battery plants of Panasonic in Japan and Tesla Motors in the United States.

Sumitomo Chemical plans to increase the production capacity of its separator plant in Ehime Prefecture by 30 percent by next spring. It will invest JPY 10 billion in the two plants in Korea and Japan for a combined production capacity of 180 million ㎡ a year by 2017.

Separators insulate the positive and negative electrodes of lithium-ion batteries. Sumitomo Chemical accounts for more than 30 percent of the global electric vehicle-battery market.

Electric vehicle sales are on the rise due to emerging brands, including Tesla Motors, and the stringent environmental regulations of China and Europe. Therefore, the lithium-ion battery market for electric vehicles is expected to more than triple by 2020.

jsmoon@yna.co.kr

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