WP "LG-SK, Battery Dispute Final Agreement... Announcement Possible Today"

WP "Agreement Announcement as Early as the 10th (Local Time)"

[Image source=Yonhap News]

[Asia Economy Reporter Hwang Yoon-joo] LG Energy Solution and SK Innovation are reportedly set to reach a sudden agreement regarding their electric vehicle battery dispute. Until last week, both companies officially dismissed the possibility of an agreement, but it is understood that they reached a sudden deal after determining that President Biden's veto would be unlikely.

According to the Washington Post (WP) on the 11th, citing multiple sources, the two sides have reached a last-minute agreement, and an announcement is expected this weekend. Reuters also reported, citing three sources, that the two parties would announce the agreement within the day.

WP explained, "SK Innovation will be able to complete the construction of a manufacturing facility worth $2.6 billion and will employ 1,000 people by the end of the year," adding, "By 2024, 2,600 employees will mass-produce lithium-ion batteries for approximately 300,000 electric vehicles, mostly for Ford and Volkswagen."

WP stated that this agreement applies not only to the U.S. International Trade Commission (ITC) decision but also to ongoing lawsuits between the two parties in U.S. courts. The agreement is expected to allow SK's factory construction in Georgia to continue. The Georgia plant supplies batteries for Ford and Volkswagen electric vehicles.

In February, the ITC ruled in favor of LG Energy Solution in a trade secret infringement dispute against SK Innovation, ordering SK to ban the import of components infringing trade secrets for ten years.

The governor of Georgia, where SK is building its battery plant, requested President Joe Biden to exercise his veto power over the ITC decision, with Sunday the 11th being the deadline for veto action.

President Biden has emphasized the importance of protecting intellectual property rights while also stressing the need to build an electric vehicle supply chain to address climate change, leading to speculation that it would be difficult for him to side with either party.

The U.S. president can exercise veto power over ITC decisions within 60 days. However, the only case of a veto being exercised was in August 2013, when President Barack Obama overturned the ITC decision banning imports of Apple iPhones and iPads.