VW, Ford EV battery supplier reaches deal to avoid import ban
Two Korean electric vehicle battery makers have reached a last-minute settlement, saving President Biden from a Sunday deadline to decide whether to intervene in the global trade secret dispute.
Why it matters: The deal between SK Innovation and its rival, LG Chem, "averts a 10-year import ban on SK Innovation Co.'s products and protects thousands of jobs in the politically important state of Georgia," according to Bloomberg, which first reported the news.
- SK Innovation is the battery supplier for certain Ford and Volkswagen U.S.-built EVs.
Catch up fast: LG Chem had accused SK Innovation of stealing its EV battery technology and hiding the evidence, per Axios' Joann Muller.
- The U.S. International Trade Commission in February sided with LG Chem, restricting SK from importing critical components for lithium-ion batteries for 10 years (with some temporary exceptions).
- Prior to the deal, SK said it may have to stop construction of a $2.6 billion battery plant in Georgia, putting at risk the 2,600 clean energy jobs that came with it.
- The import ban was set to take effect Sunday, unless President Biden intervened and overturned the ITC decision.
- South Korean officials and the Biden administration urged the companies to come to an agreement instead, according to Bloomberg.
Of note: "The settlement will cover not only a ruling by the U.S. International Trade Commission but also litigation in federal court," the Washington Post reported.
The big picture: Speeding up domestic EV and and supply chain manufacturing is part of Biden's climate and jobs push, and the trade dispute threatened to create new headwinds.
- Biden's $2 trillion infrastructure plan includes $174 billion to "win" the electric vehicle market.
What he's saying: Biden in a statement Sunday called the settlement "a win for American workers and the American auto industry."
- "We need a strong, diversified and resilient U.S.-based electric vehicle battery supply chain, so we can supply the growing global demand for these vehicles and components - creating good-paying jobs here at home, and laying the groundwork for the jobs of tomorrow."