LG Chem in a Euro36 mn Investment in Poland

The European Commission has authorised Polish investment aid of €36 million for a new LG Chem plant in the south-western region of Poland, Dolnośląskie (Lower Silesia). This corresponds with recent rumours about a project by the Korean company.

The rumours at the end of November said that the South Korean battery cell producer plans to triple its production capacity in Poland. According to the now official information, LG Chem, with the above-mentioned support of the European Commission, is indeed planning an investment of 325 million euros for a new Polish production facility that will supply battery cells for more than 80,000 electric vehicles per year.

However, as the European Commission only mentions the Lower Silesia region in its communication and not a specific city, it remains open whether the project is an entirely new plant or an extension of LG Chem’s factory in Kobierzyce, which opened in 2018.

The reason for the expansion is probably Volkswagen’s latest order: LG Chem will start supplying the German group with battery cells at the end of 2019. In preparation for a smooth supply chain, both companies formed a task force at the beginning of October 2018. Apart from the diffuse start time of deliveries, not much is known about the battery cell deal announced in spring 2018, nor is the order volume.

Meanwhile, the European Commission assures that the investment aid approved by it will contribute to job creation as well as to the economic development and competitiveness of a disadvantaged region. The initiative is expected to create more than 700 direct jobs. Further, they added: “Without the public funding, the project would not have been carried out in Poland or any other EU country”, it says.

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