SK Innovation makes strategic investment in China's battery service company

By Lim Chang-won Posted : January 21, 2021, 14:23 Updated : January 21, 2021, 17:45

This picture released by SK Innovation shows a battery exchange station run by Blue Park Smart Energy(Beijing) Technology in Hangzhou, China.[Courtesy of SK Innovation]

SEOUL -- SK Innovation, a major electric vehicle battery maker in South Korea, secured a bridgehead for its foray into China's battery service market with a strategic investment in a battery service subsidiary of BAIC, a state-owned enterprise based in Beijing. The investment underlines SK Innovation's push for a business covering battery rental, charging, reuse and recycling.

SK Innovation (SKI) said that it has acquired a 13.3 percent stake in Blue Park Smart Energy(Beijing) Technology (BPSE), which operates a battery swap station for taxis and shared service providers in Beijing and leads the establishment of national standards for replaceable batteries in China. Financial terms were not disclosed.

SKI said it has secured a bridgehead to push for Battery as a Service (Baas) in China. "We will change the paradigm of the future electric vehicle market through a BaaS business model that combines SKI's high-quality, long-life battery technology and BPSE's exchangeable battery operation technology," SKI's battery business chief Ji Dong-sup said in a statement on January 21.

The first target of cooperation will be a service that replaces discharged battery packs with charged ones, SKI said, adding the demand is growing among taxis and shared vehicles with relatively long mileage because batteries can be replaced in a short period of time.

SKI said that the battery replacement service can be expanded into service areas such as battery rental and reuse while batteries placed in replacement stations can be used as energy storage systems, contributing to the establishment of distributed power infrastructure

"SK Innovation will actively utilize BaaS business in future ESG management," Ji said. Environmental, social, and corporate governance (ESG) refers to the three central factors in measuring the sustainability and societal impact of an investment in a business.

SKI has teamed up with South Korea's Hyundai auto group to cooperate in reusing or recycling spent batteries. They will carry out an empirical cooperation process to collect spent battery packs and use them for other purposes or extract metals of economic value.

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