Summary:SKI Hungary’s battery subsidiary SKBH’s 2020 sales have increased from 1.7 billion won in 2019 to 357.2 billion won (approximately RMB 2.09 billion), an increase of 210 times.

SKI recently released a performance report showing that the sales of its Hungarian battery subsidiary SK Battery Hungary (SKBH) in 2020 increased from 1.7 billion won in 2019 to 357.2 billion won (approximately RMB 2.09 billion), an increase of 210 times; The profit reached 690 million won, which was compared with the loss of 19.5 billion won a year ago and realized a turnaround from a loss to a profit.

SKI stated that the main reason for SKBH’s return to profitability was that its first battery factory in Komárom, northern Hungary, started stable mass production in 2020, and shipments have steadily increased.

Statistics from the Advanced Industry Research Institute (GGII) show that SKI will have 4.34GWh of global installed electricity in 2020, an increase of 184% year-on-year, with a global market share of 3.2%. The global ranking has risen from 10th to 6th, mainly for Kia, Hyundai, Volkswagen, etc. The OEM provides a complete set of battery installations.

With the further increase in the sales of electric vehicles in Europe and the increase in battery factory production capacity in the later period, SKI’s European battery factory shipments are expected to further increase.

Under this circumstance, SKI also placed high hopes on its European battery business and increased investment to further expand the production capacity of the plant.

In early 2021, SKI announced an investment of 1.27 trillion won (approximately RMB 7.3 billion) in its Hungarian subsidiary SKBH, and plans to build its third battery plant near Budapest, Hungary, with an estimated annual production capacity of 30GWh.

The third plant is scheduled to break ground in the third quarter of 2021, with a total investment of approximately 2.6 trillion won (approximately 15 billion yuan) by 2028.

The new plant is close to the Ford and Mercedes-Benz plants. SKI’s purpose may be to provide nearby supporting services to its major customers.

At present, the first battery plant built by SKI in Komárom, Hungary has been put into production, with an annual capacity of 7.5GWh, and the second battery plant is still under construction, with an annual capacity of 9.8GWh. After the third plant is completed and put into production, SKI’s battery production capacity in Europe will reach more than 45 GWh.

It is worth noting that although SKI’s European battery business is showing an upward trend, its power battery business as a whole is still at a substantial loss.

At the same time, SKI was ruled by the US ITC to steal LG Energy’s trade secrets and was prohibited from selling batteries, modules, and battery packs in the United States for the next 10 years.

Under this circumstance, SKI’s power battery business will face greater pressure and challenges in 2021.