Posco Future M, formerly called Posco Chemical, said Tuesday it would construct an electric vehicle battery materials plant in Pohang, North Gyeongsang Province, after landing a 40 trillion won ($30.6 billion) deal with Samsung SDI earlier this year.
During a shareholders meeting Monday, the company decided to build a 392 billion-won plant that exclusively produces nickel cobalt aluminum (NCA) battery materials for the first time.
The estimated annual production capacity is 30,000 tons, enough for 300,000 60 kilowatt-hour EV batteries.
The company plans to break ground by the first half of this year and start production by 2025.
Including the production capacity of another plant for producing nickel cobalt manganese and aluminum (NCMA) battery materials, the company is projected to produce a total of 60,000 metric tons of cathode materials by 2025. Construction of the NCMA plant started in April last year.
Posco Future M’s renewed push in production expansion comes after the mega deal with Samsung SDI, in which the materials firm announced in January its intention to supply high-nickel NCA cathodes in the next 10 years.
Before the new NCA plant in Pohang starts operation, the company’s Gwangyang plant will be providing materials to Samsung SDI in 2023 and 2024.
“(Aside from Samsung SDI,) the company is in talks with domestic and overseas carmakers and battery manufacturers to expand the supply of NCA materials,” an official from Posco Future M said.
Posco is developing cost-effective lithium iron phosphate (LFP) materials as well. Currently, it manufactures total of five battery raw materials including NCM, NCA and NCMA.
On the same day, the company changed its name from Posco Chemical to Posco Future M, highlighting its vision to lead the development of next generation battery materials. In 2019, it was renamed from Posco ChemTech to Posco Chemical.
Posco Future M President Kim Jun-hyung was appointed as the new CEO, after the former CEO Min Kyung-zoon stepped down.
As of last year, Posco Future M logged record sales revenue of 3.3 trillion won, of which the battery materials business accounted for more than 50 percent.