Korean battery makers pivot to Europe as US EV projects collapse

South Korea's three dominant battery suppliers — SK On, LG Energy Solution and Samsung SDI — are losing billions in U.S. electric vehicle contracts as American automakers cancel or suspend production plans, and are now racing to replace that revenue with European deals, The Korea Times reported Tuesday.

The cancellations follow the Trump administration's elimination of federal EV tax credits, which cooled U.S. consumer demand and pushed Detroit automakers to scale back electrification timelines — unwinding supply chains that Korean firms spent years and tens of billions of dollars building in North America, a development closely watched by the Korean-American business community in Southern California.

The blow came into sharp focus April 30, when Nissan Motor informed suppliers it would cancel a $500 million electric SUV project at its Canton, Mississippi plant, putting SK On's planned $10 billion battery supply — 99.4 gigawatt hours of high-nickel cells agreed upon in March 2025 — in serious jeopardy. "Canton does have a future that will include diverse powertrains, but it will not include EVs," Ashli Bobo, a Nissan US operations spokesperson, said, according to The Korea Times.

The setback was not isolated. SK On had already dissolved its battery joint venture with Ford Motor in December after slow U.S. electrification progress. LG Energy Solution separately terminated its Canadian joint venture with Stellantis in February. Ultium Cells — the LGES-General Motors joint venture — is shutting down factories throughout the first half of 2026. "Ultium Cells, the joint venture between LGES and GM, will shut down factories throughout the first half of this year, so its EV battery sales volume in the U.S. market will likely be nearly zero during the period," Jeong Won-seok, an analyst at iM Securities, said, according to the report. LGES posted a first-quarter operating loss of 207.8 billion won.

Samsung SDI faces its own uncertainty, with its Stellantis partnership clouded after the multinational automaker pulled back EV output. Samsung SDI CEO Choi Joo-sun told shareholders in March that "due to the slow demand for EVs in the U.S., the joint venture with Stellantis swiftly transformed some of its production lines to produce batteries for energy storage systems," according to The Korea Times.

With North America faltering, all three Korean battery makers are pivoting hard to Europe. LGES secured a $6.8 billion contract with BMW for cylindrical batteries and a separate $1.4 billion deal to supply lithium iron phosphate batteries to Mercedes-Benz. Samsung SDI already supplies EV batteries to BMW, Mercedes-Benz and Audi — three of Germany's largest automakers — and holds a multiyear Mercedes-Benz contract valued at 10 trillion won. SK On, meanwhile, has raised utilization at its Hungarian plant, buoyed by stronger European EV sales, according to the report.

Whether European contracts can fully absorb the revenue shock from collapsing U.S. deals remains unclear, but analysts say Korean battery makers have little choice but to accelerate their westward pivot as American automakers continue to reassess — and in some cases abandon — their electric vehicle timelines.