South Korean battery makers SK On, LG Energy Solution, and Samsung SDI are experiencing mounting pressure in the US market as major automakers cancel or delay electric vehicle projects, disrupting planned battery supply agreements, according to The Korea Times.
US EV Project Cancellations Impact Battery Supply Plans
SK On is reviewing a US$10 billion supply plan with Nissan following the carmaker’s decision to drop a US$500 million EV SUV project. Nissan had earlier ended a joint venture with Ford. LG Energy Solution ended a Canadian joint venture with Stellantis in February and faces a first-half shutdown at Ultium Cells with General Motors. Samsung SDI remains in discussions with both Stellantis and GM regarding delayed projects.
Market Contraction and Financial Toll
US battery electric vehicle sales fell an estimated 28% in the first two months of 2026 following the Trump administration’s end of consumer tax credits. Ford has taken charges exceeding US$19 billion to shrink EV plans, while Stellantis recorded charges of US$26 billion for similar reductions.
The impact has reached South Korean suppliers directly. LG Energy Solution recorded its first first-quarter operating loss at 207.8 billion won (US$141 million). Stellantis also sold its 49% stake in NextStar Energy, a Canadian battery venture with LG Energy Solution once valued at approximately 1.4 trillion won (US$964 million), for US$100.
Strategic Pivot: Europe and Energy Storage
The three Korean battery makers are now leaning on Europe as a primary growth market. LG Energy Solution and Samsung SDI have secured battery supply agreements with BMW and Mercedes-Benz. SK On has raised output capacity in Hungary.
In North America, South Korean battery makers are converting some EV battery production lines to energy storage system (ESS) batteries, which support power grid stability and AI data center power requirements. However, this strategy may provide only temporary relief, as ESS contracts depend on competitive bidding and often utilize lower-margin lithium iron phosphate (LFP) cells.
LG Energy Solution has signed a deal valued at approximately 10 trillion won (US$6.8 billion) to supply BMW with 46-series cylindrical batteries over approximately 10 years, representing a significant European foothold. This two-track approach allows the companies to pursue premium EV battery deals in Europe while using the more commoditized ESS business to absorb part of approximately US$45 billion in North American investments announced between 2021 and 2025.
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