SEOUL, July 2 (Reuters) - South Korea’s LG Chem Ltd on Wednesday said it had signed a memorandum of understanding to build a factory for electric vehicle batteries in China by 2015, betting on growing demand in the world’s top car market.
The factory in Nanjing will break ground in September and will cater to Chinese automakers like SAIC Motor Corp and global firms such as General Motors, LG Chem said.
Chinese state-owned corporations - Nanjing Zijin Technology Incubation Special Park Construction Development Co Ltd and Nanjing New Industrial Investment Group Ltd - would partner with LG Chem to build the facility.
The factory would cost hundreds of millions of dollars and would generate combined sales of 1 trillion won ($989.90 million) by 2020.
The South Korean firm is hoping China will reinvigorate sales of electric vehicles, which so far have failed to live up to their initial hype.
Automakers are rushing to introduce new electric vehicles in China, encouraged by government plans to put 500,000 EVs on the road by 2015 and 5 million by 2020.
LG Chem currently has a factory in Nanjing producing small batteries and displays for smartphones and other mobile devices.
It also operates EV battery factories in Korea and the United States.
$1 = 1010.2000 South Korean Won Reporting by Hyunjoo Jin; Editing by Stephen Coates