SEOUL : South Korea's LG Chem Ltd said on Sunday it has entered into partnership with China's Huayou Group's subsidiary Youshan to build a joint electric vehicle battery material plant in Morocco in an effort to diversify its portfolio.
LG Chem, known for manufacturing more expensive nickel-cobalt-manganese cathodes, is entering the LFP cathode business for the first time to meet growing demand for cheaper LFP batteries as the auto industry steps up efforts to produce more affordable EVs, whose most expensive components are the batteries.
The IRA is designed to wean the United States off the Chinese supply chain for EVs. It requires at least 40 per cent of the value of critical minerals used in an auto battery to be sourced from the United States or a free trade partner to qualify for a $3,750 tax credit per vehicle. South Korea has a free-trade agreement with the United States.
The U.S. Treasury Department has not yet provided a precise definition of"foreign entity of concern" and how it would be applied.