Chinese-made batteries accounted for more than 40% of Korean-made electric vehicles sold in South Korea last month, highlighting growing pressure on the domestic battery industry in its home market. According to vehicle registration data from the Korea Automobile & Mobility Association and battery specification analyses released on Sept. 14, 6,590 of the 15,794 Korean-made EVs sold domestically in August used Chinese-made batteries, equal to 40.4% of the total. That is up from 24.1% a year earlier.
The increase in Chinese battery use came as total sales of Korean-made EVs rose by 3,541 units year over year, while sales of vehicles equipped with Chinese batteries climbed by 3,570 units. In contrast, sales of EVs using Korean-made batteries slipped by 29 units to 9,204. Kia’s mass-market models were a major driver of the shift. The EV5 sold 3,146 units in August, while the PV5 reached 1,744 units. Both vehicles use battery cells supplied by CATL.
Industry observers attribute the shift to a structural cost gap and a limited lineup of lower-priced battery options from Korean manufacturers. Chinese producers have strengthened the price competitiveness of lithium iron phosphate, or LFP, batteries through integrated supply chains and large-scale production, while improvements in pack design have helped offset LFP’s lower energy density. Korean battery makers, by comparison, have focused more heavily on higher-value ternary batteries and have been slower to expand mass production of LFP cells for affordable EVs.
The pressure is also visible in global market data. SNE Research reported that the combined market share of South Korea’s three major battery makers in the global EV battery market excluding China fell to 27.2% in January-July from 37.6% a year earlier, even as battery usage in that market rose 25.8% to 316.2 GWh.
To offset weaker EV demand, the three companies are expanding into North American grid energy storage systems, where demand is being supported by data center construction and broader power infrastructure growth. LG Energy Solution has built out five ESS production sites in North America and has a backlog above 140 GWh. Samsung SDI plans to raise North American ESS capacity from 7 GWh last year to 20 GWh this year and 72 GWh by 2028. SK On is also pursuing larger ESS projects in the region.
Source: BusinessKorea
