Directly without going through LG PRI
DSK said on Monday that it has clinched a battery production equipment contract worth 16.5 billion won with LG Energy Solution.
DSK didn’t mention what kinds of equipment it will be supplying to the South Korean battery maker but they are likely lamination kits, people familiar with the matter said.
The company will also be supplying the equipment directly to LG Energy Solution instead of going through LG Electronics’ Production engineering Research Institute (PRI).
The lamination will be supplied to LG Energy Solutions’ battery plant in Wroclaw, Poland.
The battery maker is currently expanding the production capacity of the plant from 70GWh to 100GWh.
DSK had also aimed to supply lamination equipment to Ultium Cells, the joint venture between LG Energy Solution and General Motors, but lost the bid to a competitor.
Ultium Cells is instead using equipment from Naintec and Shinjin Mtec.
LG Energy Solution was procuring the kits from DSK this time around to diversify its supply chain, the people said.
Lamination kits are used to attache the anode and cathode with the separator.
LG Energy Solution is the only pouch battery maker that uses this technology.
It groups lamination and stacking into one process step during production. This prevents materials from flapping during battery cell production.
The latest deal between DSK and LG Energy Solution is also significant as they are dealing directly with each other instead of having LG PRI as the middleman.
LG affiliates had previously used LG PRI to procure production equipment for them. LG PRI would take some of the profits from the sales of the equipment this way.
DSK had focused on display panel equipment previously but recorded a 14 billion won loss last year due to down turn of the market.
It has been focusing on expanding its presence on the battery equipment market to diversify its revenue stream.
A DSK spokesperson said it plans to continue its good relationship with LG Energy Solution going forward.