Rivian in no rush to use SK batteries from neighboring Georgia plant

SK Battery America's planned electric vehicle supplier plant in Georgia is just up the road from Rivian's planned EV plant, but Rivian might bypass SK as a supplier. File photo of SK's construction site in Commerce on September 30, 2020. (Hyosub Shin/Atlanta Journal-Constitution/TNS)
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SK Battery America's planned electric vehicle supplier plant in Georgia is just up the road from Rivian's planned EV plant, but Rivian might bypass SK as a supplier. File photo of SK's construction site in Commerce on September 30, 2020. (Hyosub Shin/Atlanta Journal-Constitution/TNS)

Credit: TNS

Korean EV supplier could be sidelined despite LG legal settlement

Georgia will soon be one of the leading states in the burgeoning electric vehicle market, with gigantic investments by Rivian and SK Battery America.

The two EV companies also will be virtual neighbors, their plants about an hour’s drive apart on the outskirts of metro Atlanta.

But one of those projects almost didn’t happen, even though it was much further along. And it’s unclear how closely the two companies will work together when they open for business.

A legal dispute between Korean rivals SK and LG Energy Solution nearly scuttled SK’s $2.6 billion battery plant in Commerce that’s already under construction. The two sides settled their dispute earlier this year but not before state officials became so worried that Gov. Brian Kemp, a Republican, asked Democratic President Joe Biden for help.

Rivian announced Thursday that it will build a $5 billion electric truck, SUV and van assembly plant and battery factory on the border of Morgan and Walton counties, about 50 miles south of SK’s plant in Jackson County.

ExploreHow Georgia landed ‘transformational’ $5B Rivian plant

Industry followers have said for months that SK likely would supply batteries to Rivian if the latter came to Georgia. The Atlanta Journal-Constitution also has reported that SK would be a supplier.

But Irvine, California-based Rivian has not said publicly whether it will purchase batteries from SK made in Georgia. An SK spokesman declined to comment.

Rivian’s battery operations in Georgia instead could involve a joint venture with Korea’s Samsung, according to two people with knowledge of the matter. Rivian uses Samsung batteries at its existing plant in Illinois.

That could leave SK on the outside looking in after surviving the legal challenge from a different Korean rival that threatened to unravel its broader Georgia plans.

Both SK and rival LG Energy make lithium-ion batteries to power electric vehicles. SK’s Georgia facility, first announced in 2018, will begin production next year. It already has two customers in Ford and Volkswagen.

LG Energy accused SK of stealing its trade secrets for EV battery technology and sued SK. The U.S. International Trade Commission in early 2021 ruled in favor of LG. In its ruling, the commission scolded SK for destroying evidence in the case.

Kemp was worried that Georgia could lose one of its biggest economic-development projects, and the new jobs it would create, and he asked Biden to overturn the ITC’s ruling. The legal dispute also could have complicated Georgia’s Rivian courtship if a potential battery supplier vacated the state.

When it appeared LG Energy had the upper hand in the lawsuit with SK, LG Energy suggested in court documents two potential resolutions. One was that SK could shut down construction and stop the project in its tracks. LG Energy also suggested the alternative that SK could provide financial compensation for the theft.

The latter happened when SK agreed in April to pay $1.8 billion in cash and royalties to LG. The lawsuit was withdrawn and construction proceeded. The settlement was brokered with the help of U.S. Sen. Jon Ossoff.

But legal drama involving EV-related intellectual property may not be over in Georgia. Tesla, the biggest EV maker, in July 2020 sued Rivian for allegedly stealing its trade secrets. The lawsuit is pending in California state court.

Rivian plans to begin construction at its Georgia site next summer, with production starting in 2024.

Cox Enterprises, owner of The Atlanta Journal-Constitution, owns a 4.7% stake in Rivian and supplies services to Rivian. Sandy Schwartz, a Cox executive who oversees the AJC, is on Rivian’s board of directors and holds stock personally. He does not take part in the AJC’s coverage of Rivian.

--Staff writer J. Scott Trubey contributed to this report.

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