Japanese and South Korean battery cell producers are prioritizing the North American market, with nearly half of their planned gigawatt hours (GWh) output expansions by 2030 set to occur in the region.
This shift is partly due to the Inflation Reduction Act (IRA), which has intensified the battery race and spurred greater EV battery investments in northeast Asia this year.
The IRA's expanded tax credits for clean energy vehicles and the lithium-ion battery supply chain have resulted in expanded South Korean and Japanese investments, with companies like LG Energy Solutions aligning their supply chains to make batteries that qualify for the IRA's subsidies.
South Korean battery material firms are also building a 50,000 t/yr battery precursor plant in South Korea to meet the IRA's market entrance requirements. Meanwhile, Japan is standing firm on building out domestic capacity and seeking to regain market power, despite the critical minerals agreement signed between Japan and the US in March. This shift in focus towards North America is significant, as Asia, led by China, South Korea, and Japan, has been the most sophisticated region in terms of EV parts manufacturing, especially batteries.
However, with the IRA's incentives and the increasing focus on domestic production, Japanese and South Korean battery cell producers are looking to expand their presence in the North American market.
