As previously reported, two South Korean electric vehicle battery makers reached a last-minute resolution to a bitter U.S. trade dispute, freeing President Joe Biden from having to choose between infringing intellectual property rights and hitting the country’s electrical efforts.
According to a joint statement from the two companies, SK Innovation has agreed to pay LG Energy Solution (a division of LG Chem) a sizable amount of KRW 2 trillion (about $ 1.8 billion). The fees are split equally in cash and royalties.
As noted in the aforementioned joint statement, the companies will strive to work to help the development of the electric vehicle industry in South Korea and the United States through healthy competition and friendly cooperation. In particular, we will work together to strengthen the battery network as part of the environmentally friendly policy pursued by President Biden’s administration., – the company was told.
The agreement will enable SK Innovation to avoid a 10-year ban on US battery imports and end a two-year dispute between the two companies. The import ban threatened to complicate the production of the new Ford Motor F-150 pickup truck and Volkswagen AG ID.4 SUV – both electric vehicles are set to begin mass production next year and should use batteries assembled at SK Innovation’s Georgia plant.
This standoff became a political issue for Joe Biden because it threatened up to 6,000 battery manufacturing jobs in Georgia and prompted two Democratic senators and the Republican governor of the state to urge the president to intervene. One of the senators faces re-election next year.
“This peace agreement is a victory for American workers and the American auto industry.”– said Mr. Biden on Sunday. US Trade Representative Katherine Tai noted that the deal followed through significant efforts by the administration of the President of the United States.
SK and LG have also agreed to withdraw all lawsuits filed in South Korea and overseas, according to the statement. Moreover, the companies agreed not to take any legal action against each other for the next 10 years.
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