Business Korea reports that SK Innovation plans to build an EV battery manufacturing plant in Yancheng, China by investing US$1.05 billion. It is likely to become SK Innovation’s second EV battery manufacturing plant in China behind its plant in Changzhou.

SK Innovation’s new plant will be close to Mia Motors’ plant in Yancheng and, as such, most of the EV batteries produced there will be supplied to Kia. The plant in Changzhou has an annual production capacity of 7.5 GWh and SK Innovation’s EV battery production capacity is expected to significantly increase once the plant in Yancheng is completed.

The annual production volume of Kia Motors’ plant in Yancheng fell from more than 650,000 units to 370,000 units from 2016 to last year. However, EV sales volume in China jumped from 449,000 units to 756,000 units from 2017 to 2018.

Dongfeng Yueda Kia—a joint venture between Dongfeng Motor Corporation, Yueda Group and Kia Motors—decided to stop producing Kia cars in its first plant in Yancheng to build an EV plant of Yueda Group. After the decision, it was said that the third plant in Yancheng could also be turned into an EV plant.