On March 24th, the chief executive of LG Chemical said that it would seriously deal with the legal dispute with SK Innovation in order to obtain "reasonable" and "proportionate" compensation to make up for the damage caused by the misappropriation of its battery technology trade secrets.
Shin Hak-cheol, chief executive of LG Chemical, said LG Chemical was "sorry" that, SK Innovation refused to accept the US trade group's ruling on the theft of trade secrets and was still lobbying hard to invalidate the ruling.
On Feb. 10, the National Trade Commission (ITC) sided with LG in the case, issuing a 10-year import ban on SK Innovation and issuing temporary licenses for batteries and parts needed to make products for Ford and Volkswagen in the United States, so that the automakers could find new partners.
"looking back on my global business experience over the past 30 years, ITC's ruling on the embezzlement of trade secrets and even mentioning its corporate culture highlights the seriousness of this case," Mr Xin said at the annual shareholders' meeting at its headquarters in Seoul.
For its part, SK claims that it does not need LG's trade secrets because its electric vehicle batteries are developed and produced in a completely different way, but the company is at a disadvantage in ITC's ruling because of the destruction of evidence.
Both LG and SK were trying to find a solution to the dispute after ITC's ruling earlier this month, but the two companies failed to reach an agreement because of the huge gap between the two sides in terms of the amount of settlement. According to industry insiders, LG is currently demanding more compensation from SK than they proposed before the ITC ruling, close to Won3, 000bn ($2.6 billion).
If President Joe Biden does not veto the ruling within 60 days, or if the two companies fail to reach a compromise during the presidential review period, the ruling could jeopardize SK Innovation's plan to invest 2.6 billion dollars in a battery plant in Georgia.
SK claims that closing plants in Georgia could cost Americans their jobs and affect the supply chain of electric vehicles in the United States. In response, LG says they can fill the gap left by competitors' departure.
Earlier this month, LG announced plans to invest more than $4.5 billion by 2025 to expand its battery capacity in the US and build at least two plants. LG currently operates a lithium battery factory in Michigan. It is building a new plant in Ohio through a joint venture with the US carmaker General Motors, which will be completed in 2022.
LG, which supplies Tesla and a number of automakers, accounted for 23.5 per cent of total electric car battery shipments last year, making it the world's second-largest manufacturer, slightly lower than in China's Ningde era, which had a 24 per cent market share, according to market research firm SNE Research.
In order to meet the battery needs of global car companies, LG said it will develop advanced battery technology and materials to provide customers with high-quality products. "as the battery industry is still at a very early stage, carmakers, parts manufacturers and battery manufacturers are entering into various forms of partnerships," said Xin Xuezhe. We will continue our efforts to develop next-generation battery technology to produce the best and safest batteries for the global supply chain. "
