LG Chem intends to commence production at its US car battery plant in the second half of 2013, despite slow demand for electric vehicles.

Kim Jong-hyun, head of LG Chem's battery division, told Reuters, "We plan to start a trial production in July or August."

LG Chem built the US$304m lithium-ion battery cell manufacturing facility in Michigan with US government aid totalling more than $150m. The company aimed to annually manufacture enough battery cells to power 60,000 EVs by the end of 2013.

However, production has not started at the plant because of slower than expected demand for EVs. LG Chem supplies electric car batteries for GM's Volt and Ford's Focus Electric from its facilities in South Korea.

LG Chem's CFO Cho Suk-jeh said, "We will start preparations for the plant's operation from the second half. It will soon commence operation."

Kim said, "Several years ago, there were high expectations of electric cars, but the market is slower than expected." He said expensive car costs, lack of battery charging infrastructure and limited driving range were responsible for low demand.

However, Kim expects the market to expand as electric car prices decline.

LG Chem faced losses in its electric car battery business in the January to March period due to poor demand.

"We don't think we will be able to make profit on car battery business (this year). We are trying to minimise losses on car batteries," added Cho.