To ensure normal supply, automobile manufacturers have invested in battery factories

Collaboration between global automakers and electric vehicle (EV) battery producers is booming.

Industry sources said on June 17 that Volkswagen, the world's largest automaker, has decided to cooperate with Swedish battery manufacturer Northvolt to invest 900 million euros in a new battery production plant in Norway. Volkswagen is also discussing the establishment of a new joint venture factory with SK Innovation.

Yoon Ye-seon, head of SK Innovation’s battery business unit, said at a press conference in May that the company had been in discussions with Volkswagen about setting up a joint venture for about a year.

LG Chem, which recently announced plans to set up a joint battery plant with China's Geely Auto, said it would seek to establish more joint ventures with global automakers. Industry sources said LG Chem has privately discussed the establishment of joint ventures with several companies and will announce the results soon.

In order to improve battery competitiveness, global automakers are cooperating not only with Korean battery makers but also with Japanese and Chinese battery makers. They are also busy establishing business ties with other automakers.

Toyota has decided to cooperate with China's CATL, the world's largest battery manufacturer, and plans to join forces with China's BYD and Japan's Toshiba to expand its electric vehicle business. BMW is advancing its cooperation with Jaguar Land Rover to develop electric vehicle technology. Volkswagen has joined forces with Ford to make its modular electric drive matrix (MEB) the next generation of electric vehicle standard.

Automakers believe that access to high-quality batteries is key to taking the lead in the electric vehicle market. Governments around the world have enacted automotive regulations to promote electric vehicles. For example, the Chinese government has urged automakers to produce 10% of new energy vehicles in China. But these efforts to promote environmentally friendly cars face a shortage of battery supply.

"Automakers have invested in the past to ensure their competitiveness in the battery industry but have failed. Now, they are doing everything they can to ensure battery capacity exceeds advanced technology," said an official in the electric vehicle battery industry. "Such business ties and alliances between global automakers and battery makers will continue as they enable battery makers to ensure stable demand and reduce the burden of investment due to factory expansion."