Electric vehicle battery makers in South Korea face a huge problem, and it is not one that can be fixed quickly – they have a huge talent shortage on their hands.
The brewing storm threatens to upend the plans of countries trying to tackle climate change, especially in their attempt to reduce reliance on coal-powered fuel by turning to electric vehicles.
The woes of Korean manufacturers of batteries for electric vehicles
Korea’s top three manufacturers of electric vehicle batteries all rank among the world’s top six manufacturers, controlling up to a third of the global electric vehicle battery market.
They include LG Energy Solution (LGES); SK On and Samsung SDI Co Ltd. These electric vehicle battery makers serve billion dollar customers such as Tesla, Volkswagen, and Ford, among others.
In an age where energy use is under scrutiny and clean energy is stubbornly sought after by many economies around the world, electric vehicles (or electric vehicles) are being touted as a viable solution to solving a significant portion of the problem. conundrum of climate change.
As reported by Reuters, the three Korean manufacturers of batteries for electric vehicles are in urgent need of specialists in research and engineering, in a context of exploding demand for the technology powering these batteries and vehicles.
The talent crisis isn’t just affecting battery makers
In addition, the giants of the automotive scene increasingly need more technicians with the skills and training to continue to advance advanced technologies such as solid-state batteries.
According to an LGES official as reported by Reuters, recruiting external talent is as crucial as nurturing their own, a sentiment shared by SK On and Samsung SDI.
According to the Korea Battery Industry Association, there is a shortage of around 3,000 graduate talent for roles in research and design, among others. Collectively, the Three Giants have only about 19,000 employees.
To fuel the fire, the world also faces a complex phenomenon of shortage, then an overabundance of semiconductor chips, which also affect car manufacturers.
Sadly, this isn’t just a drag for Koreans – it’s a reflection of the talent shortage in the rapidly growing global EV and battery markets.
India is also looking to boost the production and development of EV technology, including batteries, with a generous boost of $ 3.5 billion in incentives for the sector.
Taiwan is also increase the production of their electric vehicle batteries.
If the talent gap is not addressed quickly, industry experts warn that it could slow progress in the paradoxically booming market for advanced battery technology.
According to the planning group of the European Battery Alliance, retraining or upgrading is needed within the EU bloc, as the battery industry needs 800,000 new workers by 2025.
Electric vehicle battery makers target universities
Korea’s leading electric vehicle battery maker by volume, LGES, plans to launch a new “battery smart factory department” at Korea University by the spring of next year – and with guaranteed jobs for graduates, to boot.
In addition, these companies have aggressively courted talent overseas, such as the United States, in an effort to increase their nascent number of skilled battery workers.
Unfortunately, the market they find themselves in is very competitive – other Asian players such as CATL and Panasonic, as well as Western players such as Northvolt, are also looking for talent wherever they can find it.
Korea’s electric vehicle battery talent crisis is compounded by how existing employees are being aggressively poached by competitors wielding bigger carrots, according to two anonymous industrial sources cited in a Reuters report.
The average annual salary in South Korea is around 37.4 million won (2019), but new PhD graduates who are battery specialists can earn almost triple that amount (100 million won, US $ 85,000). For those below, and with a few years of experience can, on average, earn 80 million won, reports Reuters.
The talent shortage in the battery industry has already been a global problem for years. However, due to the rapid expansion of their production capacities by companies, the demand for talent is outweighing the supply of talent, according to Richard Kim, senior analyst at IHS Markit.
Soon the EV batteries of the future?
Fueling the mad rush to develop advanced EV batteries is the promise of the EV battery of the future, called solid-state. Electric vehicles have long been plagued by two lingering issues: limited range and slow charging, in part due to the limited battery technology currently available commercially (i.e. Lithium-Ion).
Global auto giant Toyota has been working on its dream of advancing solid-state batteries for more than a decade to address these issues. The company is said to be on the verge of commercial production of solid-state batteries by the end of this year, and unveil a new electric car in 2022 with the use of solid-state batteries.
Not to be outdone, rival national automaker Nissan has also been working on a prototype by 2028, while Hitachi Zosen claims to have developed a solid-state battery capable of withstanding a wide temperature range.
The Japanese government is also keen on boosting research and development, as it is also reportedly considering injecting 2,000 billion yen ($ 19.2 billion) into a decarbonization fund. Part of that would go towards building a solid-state battery production infrastructure in the country.