South Korea’s leading battery manufacturers are executing a major strategic pivot across North America. They are rapidly shifting focus from electric vehicle batteries to energy storage systems. This redirection follows a sweeping retreat by US automakers from aggressive electrification targets.
Stellantis is currently exploring an exit from StarPlus Energy. This US battery joint venture involves Korean partner Samsung SDI. The automaker announced more than twenty-two billion euros in asset writedowns last week. Consequently, it seeks to roll back EV investments and conserve cash.
The StarPlus Energy first plant began operations in December 2024. A second facility remains under construction with a target launch next year. Total investment in these two Indiana plants reaches $6.3 billion. Stellantis may now sell its stake to a third party.
This potential move follows a similar Stellantis exit last week. The company sold its forty-nine percent stake in NextStar Energy. This Canadian joint venture with LG Energy Solution went for a symbolic $100. The stake had previously carried a valuation around 1.4 trillion won.
Furthermore, LG Energy Solution acquired a third Ultium Cells plant in Michigan. This acquisition from its joint venture with GM occurred last year. SK On also dissolved its US partnership with Ford Motor in December. It split ownership of the three BlueOval SK plants accordingly.
This industry-wide strategic pivot responds to a clear market trigger. The US government abolished federal consumer EV subsidies in September 2025. Consequently, North American EV demand experienced a sharp and immediate downturn. Automakers rapidly reassessed their costly electrification commitments.
In response, Korean battery makers are accelerating entry into ESS markets. The North American energy storage sector is growing rapidly. AI data center expansion and Inflation Reduction Act tax incentives drive this demand. These factors present an urgent alternative opportunity.
LG Energy Solution vowed to secure over ninety gigawatt-hours of ESS orders. SK On set a target exceeding twenty gigawatt-hours for this year. Both companies center their efforts firmly on North America. Samsung SDI aims to boost annual ESS sales by fifty percent.
Manufacturing facilities recently acquired from former US partners are now critical. These plants will primarily serve ESS applications going forward. The strategic pivot repurposes existing assets for a new market reality.
Despite this rapid repositioning, experts express serious concerns. Professor Lee Ho-geun from Daeduk University offered a sobering assessment. He characterized the EV-to-ESS shift as essentially a stopgap measure. Energy storage demand growth will not match EV market scale.
A Korean battery industry researcher provided additional technical context. ESS battery packs require lower per-kilowatt-hour pricing than EV batteries. This pricing pressure stems from competitive tenders rather than negotiated contracts. Therefore, manufacturers increasingly supply low-cost LFP cells.
The researcher further explained the profitability challenge clearly. Winning large-scale ESS projects actually creates greater price pressure. This lowest-bid dynamic makes margin protection considerably harder. ESS cannot and should not replace the EV segment.
This strategic pivot therefore represents adaptation rather than substitution. It allows manufacturers to utilize capacity and maintain presence. However, it does not replicate the growth trajectory of electric vehicles. The long-term implications for Korean battery leadership remain uncertain.
Looking ahead, companies will likely diversify their customer portfolios. They may also accelerate LFP cell technology development. Further consolidation or partnership restructuring could follow. The strategic pivot is necessary, but it is not sufficient for sustained high growth.
