Amid intensifying global competition in the new energy sector, Toyota Tsusho Corporation has announced the acquisition of a 25% stake in LG-HY BCM Co., Ltd., marking a pivotal move in securing its position within the electric vehicle (EV) battery supply chain. This investment reflects Japan’s accelerating push into core materials and underscores the growing importance of upstream resource control and regional supply chain security.
LG-HY BCM is a joint venture between Huayou Cobalt and South Korea’s LG Chem, specializing in the production of nickel-cobalt-manganese (NCM) and nickel-cobalt-aluminum (NCA) cathode materials—key components in high-performance lithium-ion batteries. With the global EV market surging, cathode materials have become a critical bottleneck in the battery value chain, making their strategic value increasingly evident.
Through this equity investment, Toyota Tsusho gains direct involvement in the production of essential battery materials, giving it greater influence over raw material sourcing, product development, pricing, and supply timing. This move is highly strategic for Japan, ensuring a stable supply of battery raw materials for domestic automakers like Toyota and Honda, especially in the face of supply chain pressures shaped by China and the U.S.
Notably, the investment places strong emphasis on ensuring supply stability for the North American market. With the U.S. pushing forward its domestic clean energy agenda under the Inflation Reduction Act (IRA), Japanese and Korean companies are racing to establish localized supply chains in the region. Toyota Tsusho’s move aligns with this global trend of regional supply chain restructuring, aiming to build a fully integrated value chain—from raw materials to components to final vehicle assembly.
Additionally, by deepening its partnership with Huayou Cobalt and LG Chem, Toyota Tsusho is strengthening its control over critical metals like nickel, cobalt, and manganese. These metals are subject to high price volatility and are geographically concentrated, making them vulnerable to geopolitical risks. Establishing a stable and trustworthy supply network helps mitigate potential supply shocks.
In summary, this acquisition is not just a response to the global race for battery materials—it signals Toyota Tsusho’s transformation from a resource investor to a strategic supply chain operator. In the EV-driven transformation of the global automotive industry, control over high-value battery materials will be a decisive factor in shaping long-term competitive advantage.
