The two companies launched the JV, SK Continental E-motion, in January 2013, with the mission of developing, producing and distributing lithium-ion based battery systems for cars and light commercial vehicles. (Earlier post.)
SK Innovation had a 51% stake while Continental owned 49%. Both planned to invest about €270 million (at the time, around US$359 million) in the JV over five years. Yonhap said that the companies are the partnership early due to weak market demand for battery-powered vehicles amid limited infrastructure and falling oil prices.
According to Yonhap, SK Innovation said in a regulatory filing that it will buy a full stake in the Korean branch of the joint venture at 14.48 billion won (US$13.87 million) via off-board transactions within this year to dissolve it.
Yonhap quoted an SK Innovation official as saying:
We decided to withdraw from the battery venture with Continental due to the lower-than-expected synergy because clean diesel vehicles were selling more than electric vehicles in the European market. We will continue to research and develop batteries for electric vehicles in the future.