• Factors considered include power supply rate, infrastructure, and expansibility in selection of Kota Kinabalu, Malaysia, as the factory site

• To build a factory with a capacity of 44,000 tons a year, by investing 650 billion won until 2023, increasing its total production capacity three-fold

• To consider follow-up investment this year in Malaysia, Europe, and the United States∙∙∙ with the aim of securing the world’s largest production capacity, by 2025

SK nexilis, boasting its status as the world’s No.1 manufacturer of copper foil for EV batteries, as a fully owned affiliate of SKC (President Lee Wan-jae), has decided to build its first overseas factory in Malaysia. It will fully utilize its accumulated know-how, and will fulfill RE100 as the first company in the relevant sector that has ever attempted such a feat.

At its session of the Board of Directors, held on Jan. 26, SK nexilis settled on the KKIP Industrial Complex in Kota Kinabalu, Sabah, Malaysia as the site of its first factory outside Korea. It plans to build a factory with a capacity of 44,000 tons a year, by investing 650 billion won, starting work in the first half of this year and starting the commercial operations of the factory in 2023. With this factory, its total production capacity will increase three-fold to 100,000 tons a year.

The aforementioned factory is particularly significant, as the Company is committed to go 100% renewable, the first attempt of this kind made in the sector. The said commitment is the display of its resolve for ESG (environmental, social, and governance) management, and to cope with major customers’ request for the expansion of the use of RE100 materials in its production. Recently, the six SK affiliates, including SKC, its parent company, have announced their resolve to push forward with RE100, the first of its kind ever attempted by a major business in the country.

Malaysia offers merits to the Company in terms of power supply, which is a core factor in the production of copper foil. In an electrodeposited copper manufacturing process, the copper foil is deposited on a titanium rotating drum from a copper solution where it is connected to a DC voltage source. Thus, the process requires a large capacity of electric power. Malaysia ranks No.1 among Southeast Asian countries, in terms of stable power supply, and its power supply rate is at about half that of Korea’s. A large part of its power generation relies on renewable energy, like hydraulic power generation, meaning it is eco-friendly.

Kota Kinabalu, in particular, is one of the best sites for SK nexilis’s factory. As the capital of Sabah Province in the northern part of Borneo Island, the city offers the lowest power supply rate among the candidate sites and can be relied on for a stable supply of power. It has a large-sized port and an airport required for the export of products, and it provides good infrastructure like gas and water. As for the factory land, the site can accommodate the Company’s plan to expand the land to 400,000 ㎡, which is three times as large as that of the Jeongeup factory in Korea.

SK nexilis plans to install an automated facility, boasting the world-best technological capacity and know-how. SK nexilis has already taken measures to enhance productivity, by improving its facilities by adopting unmanned transportation vehicles and robots in Factory-4 in Jeongeup, which started the commercial operations this year. Based on its experience in the operation of Factory-4, SK nexilis plans to upgrade Factories-5/6 and utilize the know-how accumulated in them in Malaysia, in a bid to build the world’s No.1 copper foil factory.

SK nexilis is also considering follow-up investments in Malaysia, Europe, and the United States in order to cope with the rapidly growing markets. According to SNE Research, the EV market and the battery market are expected to grow by 41% and 38% on average, respectively, until 2025. The demand for copper foil is increasing and SK nexilis is displaying a 100% operation rate. The Company plans to expand its production capacity five-fold by 2025, through continued investment.

Commenting on the matter, Representative Kim Yeong-tae of SK nexilis said, “We will build first-rate factories that befit the technological capability we boast in the production of the world’s thinnest and longest copper foil for batteries. We will secure higher cost competitiveness through the factory in Malaysia, strengthen our EST management, including the fulfillment of RE100, and reinforce our status as the world’s No.1 business in copper foil, through continued investment.”

[Relevant photos]
 

[A view of SK nexilis’s factory in Jeongeup, Korea]

[Copper foil produced by SK nexilis] ​