LG Chem is now reportedly considering constructing a lithium-ion battery manufacturing facility in China.

LG Chem's Michigan Facility

LG Chem's Michigan Facility

As Reuters reports:

"Chief executive of LG Chem said that the South Korean company was considering building an electric vehicle battery plant in China, expecting Beijing's efforts to tackle air pollution to drive demand."

LG Chem CEO Park Jin-soo stated:

"We are considering it (the China car battery plant), which should be in line with market demand."

China has yet to show that it's actually willing and able to purchase electric vehicles in mass quantities, but the pieces are starting to fall into place.

Recently, BYD was granted the right to sell its plug-ins in both Beijing and Shanghai.  For BYD, that means it's no longer restricted to selling its plug-ins only in limited Chinese markets.

Furthermore, Reuters reports:

"China's Finance Ministry said last month it will extend a program of subsidies for buyers of electric-powered vehicles after the current subsidy regime, part of efforts to combat pollution in cities, expires in 2015."

"The subsidies were designed to help China meet a goal of putting half a million new-energy vehicles, defined as all-electric battery vehicles and heavily electrified "near all-electric" plug-in hybrids, on the road by 2015 and 5 million by 2020."

If that's not enough to convince LG Chem to go into China, then this last statement by Reuters should be:

"LG Chem's crosstown rival, Samsung SDI, said in January that it will form a joint venture in China to spend $600 million on building a car battery plant in Xi'an, Shaanxi province, by next year..."

Source: Reuters