SK On to develop large-size cylindrical battery with 4680 form factor

SK On Co., an affiliate of South Korea’s SK Group, will work on the development of a large-size cylindrical battery with the 4680 form factor increasingly adopted by major electric vehicle makers, including Tesla Inc.

If successful, SK On, a unit of SK Innovation Co., will become Korea’s first and the world’s second company after China’s Contemporary Amperex Technology Company Ltd., commonly known as CATL, to make all three kinds of batteries, including the pouch and prismatic types.

SK On currently mass-produces only pouch-type batteries for EVs and other electric devices and is in the final stage of developing a prismatic-type battery.

Company executives have decided to make cylindrical batteries and are working out a production and sales roadmap for the type, industry sources said on Sunday.

GAME-CHANGER

The so-called 4680 battery, which measures 46 millimeters in diameter and 80 mm in length, is seen as a game-changer in the battery industry as it is known to increase energy density by five times and output by six times compared to the conventional 2170 type and boost electric vehicles' mileage by 16% on average.

Tesla, the world's largest electric car manufacturer and lithium-ion battery consumer, is using the 4680 cell made in-house for its EV models but seeking to secure more of the type from other suppliers as it increases EV production.

While pouch and prismatic form factors are the most common battery types for many EV makers, some automakers, including BMW, GM and Stellantis, are gradually adopting the 4680 cylindrical type given its strengths.

SK’s decision to manufacture all three form factors comes as the cylindrical type is emerging as the industry’s favorite battery, prompting other major battery makers to join the race for next-generation batteries.

SK’s two crosstown rivals, LG Energy Solution Ltd. and Samsung SDI Co., are said to be in the advanced stages of developing 4680 cylindrical batteries.

LG currently has a strength in manufacturing pouch batteries while Samsung is good at the prismatic type, industry officials said.

LG Energy plans to begin mass production of cylindrical batteries later this year while Samsung recently produced samples of such batteries, sources said.

EXPAND FACILITIES

In December, LG said it would spend 4 trillion won ($3 billion) to expand facilities for cylindrical batteries, including the 4680 form factor, which industry officials said, are for supplies to Tesla.

Samsung is also spending heavily to ramp up its 4680-type cylindrical battery production lines for clients, including Tesla.

Chey Jae-won, SK On’s executive senior vice chairman, said last month he expects the company to witness greater growth potential in 2024 based on its accomplishments so far.

Industry officials said it will take at least two years for SK On to set the stage for mass production of 4680 cylindrical batteries.

While a pilot production line for such a type will likely come online in the second half of 2026 at the earliest, SK On will soon embark on marketing efforts to secure clients for its new batteries, they said.

According to market researcher SNE Research, the global 4680 cylindrical battery market is forecast to grow to 650 GWh by 2030 from 10 GWh in 2023 while such a type is expected to account for 21.1% of the entire battery market by 2030 from 1.5% in 2023.

Write to Nan-Sae Bin at binthere@hankyung.com

In-Soo Nam edited this article.