A scene from a ceremony to kick off construction of the copper foil plant in northeast Hungary’s Tatabanya Industrial Complex attended by a slew of dignitaries from Hungary and Korea led by Minister Szijjarto Peter of the Ministry of Foreign Affarrs and Trade, Korean Amb. Choi Kyu-shik to Hungary, and Vice Chairman Dong Hyun-soo of Doosan Group, among others. (Photo: Doosan Group)

Korean conglomerate Doosan Group has started construction of an electric vehicle (EV) copper foil plant in Hungary to capitalize on rising demand for battery materials.

The plant in northwest Hungary's Tatabanya industrial park is scheduled to be completed next year.

It will have capacity to produce 50,000 tons per year of battery copper foil, enough to supply power packs for about 2.2 million electric vehicles.

Doosan, which entered the copper foil business by buying Circuit Foil Luxembourg in 2014, aims to gain a proximity and cost advantage by building its plant in Hungary. South Korean EV battery producer SK Innovation is building its second plant in northwest Hungary, where it will have combined production capacity of 17 GWh/yr.

LG Chem has a battery factory in Poland, where it is expanding. South Korea's other EV battery producer Samsung SDI also has a plant in Hungary.

Doosan sees demand for battery copper foil rising 13-fold by 2025. An affiliate of SK this year agreed to buy KCF Technologies, a producer of copper foils and flexible copper clad laminates used primarily in EV battery cathodes, for 1.2 trillion won ($1 billion).

Doosan held a ceremony to break ground for a production plant for battery copper foil in Hungary on July 23.

Hungarian Foreign Affairs and Trade Minister Péter Szijjártó, Korean Ambassador to Hungary Choi Kyu-sik and Doosan Vice Chairman Dong Hyun-soo attended the ceremony at the factory’s new construction site in Hungary’s Tatabánya industrial complex.

The event was organized to confirm the partnership between Doosan and the Hungarian government on the battery copper foil production plant and pray for safe construction, a company spokesman said.

Doosan has been preparing to build a production plant on 144,000 square meters of land in the Tatabánya Industrial Complex since last year to produce battery copper foil, a core part of electric car battery, and is scheduled to be completed early next year.

Doosan's Hungarian battery plant is the only battery copper foil factory in Europe and is close to local electric vehicle battery companies.

 As a result, it is expected to have a competitive edge in price due to reduction in logistics costs, and an excellent competitive edge in terms of quality stability, the spokesman said.

The Hungarian government paid keen attention to Doosan's construction of the battery copper foil factory, offering various incentives.

Hungarian minister Péter presided over a meeting in November last year, when the factory was preparing to be built, helping to break ground for the Doosan factory.

Doosan acquired Circuit Foil, a maker of copper foil in Luxembourg, in 2014 and has secured original technology for battery copper foil and entered the market.

Since then, it has finished developing high-end battery copper foil products that are highly efficient to improve driving distance of electric vehicles, increase battery density, and make them lighter.

“We are very happy to see that the market for battery copper foil will grow and our strategic investments will bear fruit. We will make the plant grow into the best battery copper foil production base in the European market with high quality and price competitiveness.” said Vice Chairman Dong.

Doosan Bobcat Inc., compact construction equipment maker, has become one of the most reliable businesses for Doosan Group at a time the Korean heavy equipment conglomerate has been combating headwinds from the government policies to phase out nuclear reactors and clamp down on housing demand.

According to Doosan Group and local market tracker FnGuide on Sunday, Doosan Bobcat recorded an operating profit of over 100 billion won ($87 billion) for four consecutive quarters since the second quarter of 2018. It is the group’s top performer based on pure operating income figure, which excludes profits from subsidiaries.