South Korean automaker Kia Corp will use batteries from China’s CATL in an electric vehicle (EV) to be sold domestically, a newspaper said Wednesday, in what would mark the first use of non-Korean EV batteries for local sale. to be.
Kia, a subsidiary of Hyundai Motor Co., has chosen batteries from CATL – Contemporary Amperex Technology Co Ltd – for its Niro electric crossover SUV in a bid to expand its range of battery suppliers, Hankook Ilbo newspaper reported, citing an unnamed Kia official. CATL, whose customers include Tesla Inc and Volkswagen AG, is the world’s largest battery manufacturer with a share of more than 35% of a thriving global EV battery market, according to industry tracker SNE Research, a market analysts estimate is worth tens of billions of dollars. dollars.
The report said the automaker also took cost competitiveness into account when making its decision for the Niro EV, which focuses more on the mid-market than the premium segment of the car market. The newspaper did not disclose any financial or volume terms of the battery deal.
Kia and CATL officials were not immediately available for comment. Last year, another domestic newspaper, Chosun Ilbo, reported that CATL had won a deal to supply batteries to Hyundai Motor Group, the parent company of Kia and Hyundai Motor Co, along with LG Energy Solution Ltd (LGES) and SK On of SK. innovation.
Analysts said Kia would like to cut costs for its Niro EV by using CATL batteries that are considered more cost-effective. Batteries are typically the most expensive part of EVs, accounting for about 30-40% of the total cost of production.”
This appears to be natural for South Korean automakers as they plan to boost electric vehicle sales and secure battery capacity… relying on just a few battery suppliers can be a risk factor,” said Kevin Yoo, analyst at Daol Investment & Securities.
Hankook Ilbo newspaper said Kia had not yet disclosed its decision to use CATL’s batteries to its customers.
Hyundai Motor and Kia have so far only used batteries from two South Korean firms – LGES and SK On – for electric vehicles for the South Korean market.
That duo and domestic peer Samsung SDI Co Ltd together control more than a quarter of the global EV battery market, according to SNE Research.
