SK Innovation, a South Korean supplier of electric vehicle batteries for Ford and Volkswagen in the United States, reached a last-minute settlement with its main competitor LG Energy, according to people familiar with the matter.
Saturday's agreement avoided a decade-long ban on imports of SK innovations and protected thousands of jobs in Georgia.
The two battery suppliers had no immediate comment.
The United States International Trade Commission issued an import ban on SK Innovation on February 10. In the trade secrets case filed by LG Energy Solutions, a subsidiary of LG Chemical Company, the United States International Trade Commission ruled against SK Innovation because it thought that SK Innovation was trying to destroy evidence.
Unless the government overturns the ban on public policy grounds, it will take effect on April 11. South Korean government officials and the Biden government instead pushed for an agreement between the two companies.
The United States International Trade Commission says the president's policy has been taken into account in formulating the split plan. The spin-off plan allows SK to innovate in the introduction of parts for Ford's EV Fmur150 pickup truck for four years, as well as parts for Volkswagen's American ID.4 SUV production line for two years. Neither carmaker said it was appeased.
LG Energy accused SK Innovation of stealing billions of dollars worth of key information about how to make batteries, thus winning a contract between Ford and Volkswagen. SK Innovation denies receiving or using any confidential information from LG Energy employees it employs.
One SK innovation plant in Georgia is nearing completion and has begun producing battery samples, while a second plant has completed about 20 per cent and is expected to be completed next year. SK Innovation says the second phase of the plan will bring its total investment to about $5 billion and create 6000 jobs.
In addition to making batteries for Ford and Volkswagen, SK's innovative plant will also become the largest so-called non-self-owned plant in the United States, which means it will probably be able to meet the needs of other manufacturers.