Hyundai Motor Co. is partnering with LG Energy Solution Ltd., the world’s leading battery maker, to introduce electric vehicle (EV) battery cell swapping services in South Korea. This innovative service aims to provide EV customers with a quick and convenient solution for recharging by swapping depleted batteries for fully charged ones.
On June 19, Hyundai and LG Energy will establish a collaborative council for Battery-as-a-Service (BaaS) alongside the Korean government, the Korea Automobile & Mobility Association, and the Korea Battery Industry Association. Industry sources also indicate that SK On Co. and Samsung SDI Co. are considering joining the council. The council’s inaugural meeting in Seoul will address eight key issues, including EV battery performance assessment and carbon emission estimation.
BaaS is an emerging business model where EV ownership includes a subscription to a battery exchange program, allowing drivers to swap batteries at designated stations, thus saving time compared to traditional charging methods. Hyundai is currently developing vehicles capable of safe battery replacements under the BaaS system, which the company believes will significantly boost EV sales by reducing overall costs.
“EV prices will fall if the BaaS market expands,” said an auto industry official, noting that batteries account for approximately 40% of an EV’s price.
China has already embraced BaaS, with EV maker Nio Inc. operating around 2,400 battery swapping stations. The global EV battery swapping market is projected to reach $36.6 billion by 2030, a tenfold increase from 2023, according to Stratistics MRC.
While BaaS is still in its early stages in Korea, the collaboration between Hyundai and LG Energy, the nation’s leading EV maker and battery producer, is expected to rapidly advance the local market. Hyundai received government approval in February to develop EVs capable of battery swaps within five minutes. The company, through its in-house venture PIT IN, will commence a demonstration project targeting taxi drivers and delivery riders in the second half of this year.
LG Energy, through its in-house venture Kooroo, is also advancing its battery swapping services for electric bikes. This partnership and the ensuing technological developments are set to position South Korea at the forefront of the global BaaS market, fostering greater adoption of EVs and contributing to the reduction of carbon emissions.
