LG New Energy New Technology Improves Cell Yield

Foreign media reported that LG New Energy adopted a new lithium-ion battery degassing process in its American battery plant to improve its battery cell yield and production efficiency. LG New Energy's US plant mainly produces soft-pack batteries. The original production process involves stacking and encapsulating electrode materials, then welding electrodes, encapsulating with aluminum-plastic film, and finally injecting electrolyte and exhausting excess gas inside, and finally sealing. However, this process will lead to incomplete exhaust inside the cell, resulting in a low yield rate. The new technology of LG New Energy is to erect the battery cells for exhaust, which reduces the volume of the production equipment by 40% and reduces the defect rate of the battery cells. After the exhaust is completed, the aluminum-plastic film is folded, heat-pressed and sealed, and the excess part is cut to complete the manufacturing. LG New Energy said that the new process has reduced its battery production line from 45 meters to 20 meters, which has significantly improved production efficiency. This technology will be applied to many battery factories in the company worldwide, including Poland and my country. Behind LG New Energy's adoption of new processes to improve its product yield is that it is currently facing a more prominent product quality crisis. A series of electric vehicle fires, recalls, and energy storage system fires that have erupted since the second half of 2020 have exposed the large quality defects and safety hazards of LG New Energy's lithium-ion battery products. If quality problems cannot be resolved in time and product safety is further improved, LG New Energy’s power lithium battery and energy storage business will be greatly affected. Under this circumstance, it is particularly necessary for LG New Energy to adopt new processes to improve its product safety and yield. While improving product performance, expanding production is also an important means for LG New Energy to enhance its market competitiveness. LG New Energy established a lithium-ion battery plant in the United States in 2012, with an output of 2GWh. In order to further meet market demand and enhance competitiveness, LG New Energy plans to invest US$4.5 billion in the United States by 2025 to increase its US battery production by 70GWh. In addition to self-built plants, LG New Energy is currently investing US$2.3 billion with General Motors to build a battery plant with a capacity of 32 GWh. It also plans to build another battery plant with a planned output of 35 GWh. In addition, the second battery plant constructed by LG New Energy in Nanjing, my country, was recently completed and is about to enter the production stage. The plant mainly supplies power lithium batteries to the European market. The total investment of the project is 1.3 billion U.S. dollars (approximately RMB 8.4 billion). Behind LG New Energy's acceleration of its global battery production expansion is the acceleration of global electrification, and the sharp increase in sales of new energy vehicles has seen strong demand for power lithium batteries. LG's new energy power lithium battery installed capacity has risen sharply, surpassing Panasonic in 2020 and will be promoted to No. 2 in the world. Entering 2021, the market for new energy vehicles including my country and Europe continues to heat up, driving the market demand for power lithium batteries to further rise. For the first time, LG New Energy's power lithium battery revenue has increased significantly year-on-year. It is worth noting that although LG New Energy is improving its competitive advantage in the field of power lithium batteries through technological innovation and production expansion, it still faces multiple pressures and challenges as a whole.