US President Joe Biden on Sunday welcomed a last-minute agreement ending a trade dispute between two South Korean electric-vehicle battery makers that he said represented “a win for American workers and the American auto industry.”
The deal between industrial giants SK Innovation and LG Energy Solution was also seen as a victory for Biden as he presses for a quick embrace of electric vehicles as a key element in combating climate change.
The deal will clear the way for two new factories in Georgia to supply batteries for Ford and Volkswagen.
Under the last-minute resolution of the trade-secrets dispute, SK Innovation will provide LG Energy Solution with a total of $1.8 billion and an undisclosed royalty, the companies said in a joint agreement.
It said they had agreed to withdraw all pending trade disputes in both South Korea and the United States and to not assert new claims for 10 years.
“We have decided to settle and to compete in an amicable way, all for the future of the US and South Korean electric-vehicle battery industries,” said Jun Kim, who heads SK, and Jong Hyun Kim, his counterpart at LG Energy.
“A key part of my plan to Build Back Better is to have the electric vehicles and batteries of the future built here in America, all across America, by American workers,” Biden said in a statement.
“We need a strong, diversified and resilient US-based electric-vehicle battery supply chain, so we can supply the growing global demand for these vehicles and components – creating good-paying jobs” now and in the future, he said.
The Korean settlement was “a positive step in that direction.”
According to the Washington Post, SK Innovation can now complete work on US manufacturing facilities costing $2.6 billion which will employ 1,000 workers by the end of this year and 2,600 by 2024, when they expect to produce batteries for more than 300,000 electric vehicles annually.