Hanwha Group and LG Energy Solution announced they will invest in building battery production facilities in the United States.
The joint investment will pave the way for Hanwha to lead the rapidly-growing energy storage market and future Urban Air Mobility business.
The two companies signed a memorandum of understanding in Seoul for comprehensive battery business cooperation for ESS and other clean-tech energy solutions. The MOU was signed by LGES and three subsidiaries under Hanwha Group - Hanwha Solutions, owner of clean energy manufacturer Qcells, Hanwha Corporation/Momentum and Hanwha Aerospace.
The joint investment is expected to boost battery supply resiliency for the U.S. market amid the growing need for American-made energy storage system following the passage of Inflation Reduction Act. The two companies will also pursue technology cooperation for developing advanced ESS solutions tailored for commercial, industrial and utility market. They include enclosure, heat management and other balance of system.
Hanwha Solutions owns Qcells, the biggest silicon-based solar manufacturer in the United States. Being the only company to establish a complete solar supply chain in the United States, Qcells leads the country's clean energy transition. Already being a market leader in the module manufacturing business, Qcells intends to become a top-tier solar and energy storage developer and EPC provider in the US by securing stable batter supply as well as procuring the competitive product solutions.
With the MoU, LGES has now secured another stable market demand in the mid- to long-term in the U.S. clean energy market where the fastest growth is expected, and thereby established a solid growth platform by reinforcing its well-balanced business portfolio of three sectors: advanced automotive batteries, mobility & IT batteries, and ESS batteries.
In 2022, LGES advanced into the field of ESS System Integration by establishing a new corporation, LG Energy Solution Vertech. Inc., which offers customers a streamlined approach to energy storage system integration and a secure battery supply chain through LGES.
The other Hanwha subsidiaries - Hanwha Corporation/Momentum and Hanwha Aerospace - will also participate in battery cooperation with LGES. Hanwha Aerospace is a leading aerospace and defense company manufacturing rocket engine, satellites technology. Hanwha Corporation/Momentum is an automation engineering company providing manufacturing facilities for batteries, solar panels and display.
Hanwha Momentum will seek to supply key battery manufacturing facilities for LGES, which is constructing joint battery factories with global automakers such as GM, Stellantis and Honda. Its existing factories in Korea, Poland and Michigan are also scheduled to expand. Hanwha Aerospace is also planning to work with LGES to develop special-purpose batteries for Urban Air Mobility.
"We have decided to collaborate with LG Energy Solution, which has several large-scale manufacturing facilities being constructed in U.S., to target the U.S. ESS market boasting fast growth thanks to green energy policies," said Hanwha Group. "Our aim is to maximize synergy at home and abroad by promoting partnerships in various fields, such as supplying battery manufacturing equipment and developing special-purpose batteries."
"Our partnership with Hanwha Group is expected to take the competitiveness of each company's battery-related businesses a step further," said LG Energy Solution. "By signing this MoU with leading, like-minded energy companies, we put ourselves in the best possible position to successfully expand the influence of our solar and ESS businesses in the U.S., and we will do our very best to provide customers with comprehensive green energy solutions."
