LG Chem to supply Volvo with electric vehicle batteries

South Korea's LG Chem Ltd. said Monday it has been picked as a provider of lithium-ion battery packs for electric vehicles by Volvo Cars Corp., the Swedish automobile manufacturer.

The largest local maker of electric vehicle (EV) batteries, however, did not disclose when it will start providing the packs to Volvo Cars, citing a request by the Swedish carmaker. A battery pack is a set of individual battery cells.

LG Chem has signed a deal to provide electric vehicle batteries to five companies so far -- South Korea's top carmaker Hyundai Motor; CT&T Corp., a South Korean maker of electric cars; China's third-largest carmaker Chang'an Automobile Group; Eaton Corp., a U.S. commercial vehicle components maker; and U.S. automaker General Motors Corp.

"LG Chem predicts that it will sign four additional deals to supply the EV batteries at the end of this year," Peter Bahnsuk Kim, a vice chairman of the company, said in a statement.

LG Chem will start the construction of a US$303 million EV battery plant in the U.S. state of Michigan in July with the aim of starting mass production of EV batteries by 2012.

In June 2009, the company broke ground for an EV plant in Ochang, 95 kilometers south of Seoul, which is expected to cost 1 trillion won ($906 million). LG Chem plans to complete the plant by 2013.

LG Chem will start providing its EV batteries to GM and Eaton in the second half of this year.

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