Samsung SDI inks first battery supply deal with Hyundai

Samsung SDI Co. said on Monday it has signed its first supply agreement with Hyundai Motor Co. to become the South Korean carmaker’s third domestic battery supplier after LG Energy Solution Ltd. and SK On Co.

Their seven-year supply deal will diversify Hyundai’s battery form factor into prismatic batteries. It has powered EVs mainly with pouch-type batteries.

Under the agreement, Samsung will ship its latest model, sixth-generation prismatic batteries (P6) to be produced at its Hungary plant to Hyundai’s assembly lines in Europe starting in 2026, Samsung said in a regulatory filing.

The P6, scheduled for mass production in 2024, improves energy density by more than 10%, so it boasts longer mileage and less charging time compared with its predecessor, the P5.

It is a type of nickel, cobalt and aluminum (NCA) batteries with a nickel content of 91% in the cathode and features a silicon-based anode, instead of graphite-based materials.

Samsung SDI's batteries will be installed on Hyundai’s next-generation EVs to be rolled out in Europe.

Last year, Hyundai Motor Group, which encompasses Kia Corp., said it would transform its plant in the Czech Republic, a production base for the automotive group’s European market, into an electric vehicle line.

The European Union this year decided to ban the sale of new combustion engine cars from 2035.

“We have taken the very first step forward with Hyundai Motor,” Samsung SDI Chief Executive Choi Yoonho said in a statement.

Choi said the two companies will continue their partnership for research on next-generation battery platforms.

Samsung expects the supply deal would be an important inflection point in expanding the adoption of prismatic batteries.

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

Yeonhee Kim edited this article.