The Korea Herald


Korea’s battery exports to grow 33% annually until 2030: Goldman Sachs

Surge in exports to increase nation’s GDP by 0.3% by 2027

By Byun Hye-jin

Published : May 8, 2023 - 15:09

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SK On’s NCM9 battery (SK On) SK On’s NCM9 battery (SK On)

South Korea’s battery exports are estimated to post an annual growth rate of 33 percent until 2030, boosting the country’s GDP growth by 0.3 percent, a report issued by Goldman Sachs showed Monday.

According to the global investment bank, Korean battery makers’ global sales are expected to surge by an average of 43 percent in the cited period.

The nation’s rapid expansion of its EV supply chain will have a positive impact on macroeconomic indicators such as the GDP growth rate and the won-foreign currency exchange rate, it said.

“It will bring production increases (in) Korea-made batteries which could ramp up the country’s real GDP growth rate to 0.3 percent annually for the next five years,” it said in the latest report analyzing Korea’s EV supply chain.

The boost in battery manufacturing is expected to increase Korea’s annual export and import growth rate to 2.5 percent and 1.4 percent respectively, improving the current account balance.

“Considering the production ramp-ups in the US and Europe, technological advancement and tax credits from the US, Korean battery makers have the upper hand to benefit from the burgeoning demand for electric vehicles in the regions other than China,” the report said.

By 2030, the US and Europe will see annual growth in demand of 33 percent and 28 percent respectively, fueled by fast-growing global demand for rechargeable batteries.

Goldman Sachs also forecast that battery demand in China, the world’s largest market for clean cars, will witness a rather poor rate of growth at 11 percent each year because there is already high demand.

“Rising demand for batteries in the US and Europe will be met by regions except for China,” it said, stressing that Korean battery manufacturing companies are expected to see a boost in global businesses.

Under the assumption that Korea’s non-EV related exports to the US and China increase at the same level, if Korean companies expand production capacity in regions other than China and the US accelerates EV transition, the nation’s total exports to the US are highly likely to outpace that to China, it added.

Industry insiders say Korean battery makers already have the high ground compared to Chinese companies, after making the list of electric vehicle models eligible for US tax credits.

Of the 22 electric vehicles, 17 models have installed Korea-made batteries. LG Energy Solution topped the list with 11 models, supplying for General Motors, Stellantis and Ford Motor, according to data from the US Department of Energy.

Samsung SDI and SK On produce batteries for 4 eligible models made from Stellantis and Ford Motor, and two Ford models, respectively. The rest of the three Tesla models are equipped with Japan’s Panasonic and China-based CATL.

LG Energy Solution, Samsung SDI and SK On have complied with the US’ Inflation Reduction Act by producing more than 50 percent of battery components to be made in the US and more than 40 percent of battery materials to be mined and refined in the US, and in Poland and Hungary, countries with free-trade agreements with the US.