Samsung SDI joined other Korean battery majors to ramp up battery plants in China to be ready for a leveler playing field in the world’s biggest electric vehicle market as the result of 2020 sunset in Beijing subsidies to EVs.

The company on Wednesday announced it will spend 1.3 trillion won ($1.15 billion) to up battery production capacity in Xian and Tianjin.

The expansion on the battery factory in Tianjin, China, will be completed by early next year. The company will spend about 400 billion won to add three to four new lines in a 100,000 square meter site near its existing factory built in 1996 for production of small-size batteries powering smartphones and other small gadgets.

Samsung SDI also confirmed it will build two new battery plans in Xian in addition to its facility dedicated to medium- and large-size batteries for electric vehicles. The company is currently in discussion over investment details.

On Wednesday, shares of Samsung SDI rose 2.46 percent to finish at 208,500 won in Seoul trading.

Samsung SDI has three EV battery factories – in Ulsan, Hungary, and Xian. The existing factory in Xian has capacity to produce 30,000 electric vehicle-use batteries, which is only half of that of Ulsan. Samsung SDI is expected to invest over 900 billion won to expand its facility in Xian.

Samsung SDI’s expansion initiative in China follows similar moves by its Korean peers ahead of the expiration in Beijing’s generous subsidy program in 2020 that favored local battery makers.

LG Chem has begun construction for its second factory in Nanjing at a cost of $1.9 billion. SK Innovation also is building 7.5-GWh battery cell plant in China.

By Lee Sang-duk and Lee Eun-joo

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