EcoPro BM Company, a South Korean battery materials producer, was considering cutting battery cathode production capacity and investments as global battery electric vehicle (BEV) markets continued to slow, according to local reports.

The announcement was made after parent company EcoPro reported a KRW55bn (US$40m) operating loss in the second quarter of 2024, compared with an operating profit of KRW170bn a year earlier, while revenue plunged 57% to KRW864bn.

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A key customer, Samsung SDI Company, also reported a sharp drop in second quarter earnings, of 38% to KRW280bn after revenue declined by 24% to KRW4.5trn, as BEV demand in key markets including South Korea and Europe dropped sharply.

EcoPro BM vice president Kim Jang-Woo said in a statement: “We are considering slowing down and cutting mid- to long-term cathode capacity, given recent sluggish growth and volatilities in the EV markets,” adding the company would make a formal announcement in the second half.

Kim said the company was still committed to fulfilling “localisation requests by customers to meet regulations in Europe and North America”.

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It was also diversifying its customer base to include manufacturers of energy storage systems (ESS) and power tools.

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EcoPro BM was currently building a battery cathode plant in Hungary with an annual production capacity of 54,000 tons which was scheduled to be completed in 2025.

It was also adding new facilities in South Korea, including a precursor plant which was also scheduled to begin operations next year, and had strengthened its global supply chain with investments in raw material producers in countries such as Indonesia.