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Semiconductor Firms Pivot to Booming Lithium-Ion Battery Market Amid Recession

Semiconductor and display equipment manufacturers are increasingly entering the lithium-ion battery market, seeking opportunities in this relatively booming sector compared to the recession-hit semiconductor and display markets. The development of lithium-ion battery-related equipment using existing technologies is less difficult, with lower barriers to entry.

Industry sources report that semiconductor and display equipment manufacturers are diversifying their businesses into the lithium-ion battery market. Shinsung ENG, a specialist in clean rooms and renewable energy, is working to expand its dry room orders, particularly in overseas markets. Dry rooms, which control humidity in lithium-ion battery manufacturing environments, are a key infrastructure facility. Shinsung ENG has leveraged its clean room technology expertise to develop and supply dry room-related equipment. As of last year, semiconductors accounted for 43% of Shinsung ENG’s clean room-related business, with lithium-ion batteries representing 18%.

With active investment in the lithium-ion battery market in the US and Europe, Shinsung ENG is considering establishing a new corporation in Spain. Iljin Materials, one of Shinsung ENG’s primary dry room customers, is investing $380 million in a copper foil manufacturing plant for electric vehicle batteries in Catalonia, Spain, boasting an annual production capacity of 25,000 tons.

DI, a company specializing in semiconductor inspection equipment, is preparing to commercialize Energy Storage Systems (ESS) this year. To enter the market, DI established an ESS division in-house last year and has been developing related technologies. The company is currently testing samples with major customers, aiming to begin mass production later this year.

Smart factory specialist, SFA, is also focusing on expanding its presence in the lithium-ion battery market. The company’s lithium-ion battery sales increased significantly from 2% in 2017 to 33% last year, securing major South Korean and European lithium-ion battery manufacturers as clients. SFA is planning to provide turnkey solutions related to the lithium-ion battery manufacturing process to customers through its recently acquired company, CIS.

SFA Semiconductor, a subsidiary of SFA Semiconductor Packaging, is participating in a national project to develop an oxide-based ultra-small laminated all-solid-state battery (MLCB) for substrate mounting. MLCB is safer and has a higher energy density compared to existing lithium-ion batteries. SFA Semiconductor aims to develop and commercialize the world’s first MLCB packaging through this project.

The increasing focus on the lithium-ion battery market by South Korean companies is attributed to business diversification and the sector’s growth potential. According to SNE Research, the global lithium-ion battery production capacity is projected to grow at an average annual rate of 27% from 994 GWh in 2021 to 8,247 GWh in 2030.

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