South Korean battery maker LG Chem said Wednesday it had signed a long-term supply deal with Volvo Cars for electric vehicle batteries, as the Swedish carmaker is aggressively pushing electrification initiatives.
The Korean firm was selected to supply car batteries along with Chinese battery manufacturer Contemporary Amperex Technology.
While the two companies did not elaborate on the details of the financial deal and supply amount, LG Chem said the agreement will allow it to deliver lithium-ion batteries for Volvo’s next-generation electric vehicles.
“As we enter the EV era, we believe the deal will help us become a leading company in the battery market,” said Kim Jong-hyun, who heads LG Chem’s battery business division.
Volvo has pledged that every new model from this year would be equipped with hybrid or electric technology. The company has also announced that half of its sales will consist of fully electric cars by 2025.
The carmaker has been launching electric vehicle models under Volvo and its sub-brand Polestar in the increasingly competitive market. It faces growing challenges from other global car manufacturers, such as Volkswagen, Tesla and General Motors.
Along with Samsung CATL and Samsung SDI, LG Chem is one of the few large battery suppliers in the electric vehicle market. Last year, it was tapped as a battery supplier for German carmaker VW.