Samsung SDI Expands Auto Battery Division

Samsung SDI announced today that it is buying the battery pack division of Magna International, which will further solidify the company’s foothold in the automotive market.

The agreement to buy Magna Steyr will include all 264 employees as well as the current business contracts and all production and development sites. The division is based out of Austria, and builds battery packs for electrified vehicles.

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It’s a “key strategic step for Samsung SDI to strengthen the competitiveness of our automotive battery business,” said Namseong Cho, president and CEO of Samsung SDI. “It will provide new momentum to expand our business and customer base.”

With the acquisition, Samsung will focus on growing customers in the electrified vehicle markets in North America, Europe and China. By 2020, Samsung predicts that this market will reach 7.7 million vehicles worldwide.

The purchase of Magna Steyr is only the latest step in Samsung’s advances as a battery supplier for automotive market.

Construction is currently underway for a new Samsung plant in China. After opening in October, the factory will be capable of supplying batteries for more than 40,000 electrified vehicles.

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Samsung is also working directly with several car companies.

It’s currently supplying batteries for BMW’s i3 and i8, and has an agreement that includes all future BEVs, PHEVs or EVs from the German automaker.

Ford also created a partnership with Samsung last summer to build ultra-light lithium ion batteries. In addition, the companies announced that together they will be developing a dual battery system that combines a 12-volt lead acid battery with a regenerative braking system.

Rumors that Tesla may be in talks with Samsung have also surfaced in the last few weeks. According to the Korean Times, the tentative agreement will have Samsung covering 8-percent of Tesla’s batteries this year, increasing to 40-percent by 2016.

If such an arrangement is created, it’s unsure how it will impact Tesla’s current relationship with Panasonic. The duo are collaborating to build the Gigafactory, a large-scale battery plant that is set to open sometime next year.