SK Innovation announced on July 18 that it will receive 90 million euros ($106 million) subsidy from the Hungarian government for the construction of its second electric vehicle (EV) battery plants.
SK Innovation has invested about 945 billion Korean won to build its second plant in Komárom, Hungary, with an annual production capacity of about 10 gigawatts (GWh). The plant will be completed sometime this year and will begin commercial operation from next year.
The receipt of the subsidy is due to the recognition of the economic and job creation effects that will occur in the future due to the operation of the second plant.
Within the EU, All countries must obtain approval from the EU Commission when they want to offer subsidies to certain companies. The EU Commission approved the Hungarian government’s subsidy plan after about 10 months of review.
It is unusual that the company got approval from the commission so quickly, according to SK Innovation.
The EU Commission’s decision was based on a conclusion that SK Innovation's battery plant will contribute to developing the economy of countries in the European Union in a balanced manner and also has a great effect of creating jobs, SK Innovation said in a statement.
As a result, SK Innovation's battery business is clearly recognized as a partner in eco-friendly policies that bring economic development to the EU and promote consumer welfare.
The Hungarian government reportedly stressed to the EU Commission that SK Innovation has a variety of customers, including Germany's Volkswagen, Daimler AG, China's Beijing Automotive Group, Korea's Hyundai Motor and Kia.
SK Innovation is also leading the market in 'High Nickel' technology, which determines performance in lithium-ion batteries.
SK Innovation recently announced in "Story Day", which announced the company's future vision and strategy, that its order balance already amounts to 1 terawatt-hours (TWh), which is enough to power about 14 million electric vehicles (EVs).
"With aggressive investment, SK Innovation will become a global leader in electric vehicle battery market," said Ji Dong-seop, chief of SK Innovation's battery business. "SK Innovation will make efforts to contribute to the development of local communities, as well as the electric vehicle ecosystems."
