Hyundai Motor Group’s steel production subsidiary, Hyundai Steel Company, looks set to supply several local battery materials producers with iron powder for the use in lithium iron phosphate (LFP) batteries for electric vehicles (EVs), according to local reports.

According to sources close to the company, Hyundai Steel wants to supply several South Korean battery materials producers, including EcoPro BM, LG Chem and L&F, with iron powder for use in LFP batteries which are seen as one of the main low cost alternatives to lithium ion batteries.

Vehicle manufacturers globally are under tremendous pressure to reduce the cost of their future EV models, as competition from Chinese manufacturers continues to be ramped up.

The sources suggested Hyundai Steel had received positive feedback from its battery materials partners, paving the way for commercial production. The company was understood to have the capacity to produce up to 60,000 tons of iron powder per year, enough for around 1m LFP battery powered EVs.