South Korean battery manufacturer SK On Company plans to cut its domestic workforce as it looks to ride out the current downturn in global demand for battery electric vehicles (BEVs), according to local reports citing industry sources.

A company spokesperson emphasised that “"nothing had been confirmed at this time".

The South Korea battery industry has been hit hard by the sharp downturn in BEV demand this year, both domestically and in key markets such as Europe, and well as by rising competition from Chinese automakers.

SK On is understood to be planning to introduce "efficiency measures" to reduce its domestic workforce and stay competitive amid challenging market conditions. The company’s staff will be offered the options of voluntary early retirement and unpaid leave.

According to reports, SK On plans to offer staff opting for early retirement 50% of their annual salaries up front and an additional cash lump sum. For those choosing unpaid leave, SK On plans to make available a "special leave programme” that will help staff to “recharge and advance their professional skills”. The company is expected to offer to pay half the tuition fees for two years for those choosing to undertake university degrees, with the remainder to be paid when they return to work.

SK On has manufacturing operations in South Korea, Hungary, China and the US and supplies batteries to automakers including Hyundai-Kia and VW and has a major battery joint venture with Ford Motor in the US called Blueoval SK.