By Kim Kwang-tae
SEOUL, Sept. 17 (Yonhap) -- LG Chem Ltd., South Korea's leading chemical company, said Thursday that it has decided to spin off its battery business in a move to further boost its leading position in the sector amid growing demand for electric vehicle (EV) batteries.
The spinoff is scheduled on Dec. 1, the company said in a regulatory filing.
The decision came after LG Chem's battery business unit achieved an operating income of 155.5 billion won (US$132 million) in the second quarter on quarterly record sales of 2.82 trillion won, all record figures so far.
LG Chem has said its battery business unit could continue to post sharp growth in the third quarter due to increased shipments of EV batteries to Europe and increased sales of cylindrical batteries.
LG Chem is a key supplier of batteries for electric vehicles, including those of GM, Ford, Renault, Volvo, Audi, Volkswagen and Daimler, as well as South Korea's largest carmaker, Hyundai Motor Co., and its smaller affiliate, Kia Motors Corp.
LG Chem has said it is on track to boost its production capacity to 100 gigawatt hours by the end of this year, which is enough to supply batteries for about 1.7 million electric cars.
The company has also said its order backlog for EV batteries is currently valued at more than 150 trillion won.
LG Chem was the largest supplier of EV batteries in the first seven months of this year with a 25.1 percent share, according to market tracker SNE Research.
SNE Research attributed the hike to robust sales of the Tesla Model 3, the Renault Zoe EV and others that are powered by LG Chem's EV batteries.