● How Korea’s electric vehicle industry can win competition with China after the charm (contributed to Korea Electric Newspaper)

The “Chasm theory” advocated by Jeffrey Moore refers to a phenomenon in which demand temporarily stagnates or retreats between the initial market and the mainstream market after high-tech or products are released. In order to penetrate the public beyond innovators and early adopters, they say that they must be able to instill trust by providing certain benefits of products, and that they go through a temporary slump before they are fully equipped with these elements. The term “casm” has been used a lot in the global electric vehicle industry since the second half of last year. Depending on how much effort each company made during the period, the competitiveness gap after “casm” is likely to be wide. Let’s think about where the competitiveness of the Korean electric vehicle industry will come from in advance.

In order to provide consumers with the clear benefits of electric vehicles, what becomes important will 1) fall in price 2) improvement in charging performance 3) increase in value in use. The speed of adoption of LFP batteries is increasing to reduce the cost of electric vehicles. The Chinese battery industry is taking a strategy of increasing energy density with Mid-Low-end LMFP batteries and M3P based on the clear advantage of LFP batteries in the price competitiveness at Low-end. Based on the clear performance advantage of high-nickel batteries at High-end, the domestic battery industry is taking a strategy of increasing its competitiveness as mid- to low-priced anode materials such as high-voltage mid-nickel and manganese rich. By 2030, premium products account for 20%, volume products account for 65%, and low-cost products account for 15%. In the future, the Chinese and Korean battery industries are expected to compete fiercely in middle volume products. For us, we will need a strategy to increase our competitiveness in volume products while gaining an overwhelming technological advantage in premium products.

Silicon cathode materials and CNT conductive materials are typical material technologies that can increase energy density while shortening charging time. As the silicon content increases, the volume of silicon expands during repeated charging and discharging processes, shortening the life of the battery, so the silicon cathode material must use a CNT conductive material together. The technology of domestic silicon cathode materials and CNT conductive materials is at a considerable level compared to that of China and will become an important factor in maintaining the technology gap with China in the future. Currently, price is important to overcome the charisma, but when the price of an electric vehicle becomes similar to that of an internal combustion locomotive, the driving distance will eventually become important again. The best direction to reduce the volume occupied in the interior space of the vehicle while increasing the energy density and shorten the charging speed will be the development of all-solid-state batteries. Recently, China has also invested 6 billion yuan to speed up the development of all-solid-state batteries. In electric vehicle premium products, efforts should be made to maintain a clear technological advantage in the Korean battery industry.

To compete globally in the battery industry, it needs to do well in the U.S. market. Historically, only semiconductors and displays have been the only industries in which domestic material companies have global leading technology, but battery material companies are now opening up opportunities. The battery material industry has an absolutely high proportion of material costs, and the U.S. restricts China’s entry into the local market, giving domestic companies time to prove their mass production capabilities in the initial market. GM, Ford, Stellantis, and Hyundai-Kia and Honda, which have high sales in North America, are all undergoing internalization of batteries and are actively cooperating with domestic companies. China is actively trying to enter Europe beyond the U.S. check. Recently, there is news that Chinese electric vehicle and battery companies are having difficulty entering the European market. In order to build factories in overseas regions in the future, it will be an important competitiveness to secure an alternative energy-based power system through RE100 in advance. In this process, securing mass production yield that achieves high quality and safety standards will further widen the gap between leading and latecomers.

Cascism does not provide opportunities for everyone equally and induces a new economic order to be reorganized. Through Cascism, the domestic battery industry is buying time to win the competition with China, and we should try to stand up using it as a stepping stone.