PETALING JAYA: Korea’s SK Nexilis, a copper foil producer for electric vehicle (EV) battery manufacturer SKC, has announced its first overseas production base to be in KKIP Industrial Complex, Kota Kinabalu, Sabah.
With proposed investments of 650 billion won (RM2.3 billion), the company looks to construct a copper foil manufacturing facility with an annual production capacity of 50,000 tons.
The facility’s construction will tentatively begin in the first half of 2021 and commercial operations to kickstart by 2023. Once in operations, the new facility will increase SK Nexilis’ copper foil production capacity by three times its current global capacity to about 100,000 tons.
SK Nexilis prides itself as the world’s number one technology in manufacturing copper foil for batteries. The company has an industry reputation for building among the best copper foil factories.
Datuk Seri Mohamed Azmin Ali, Senior Minister and Minister of International Trade and Industry (Miti) said the government is pleased that a subsidiary of a Fortune 500 company has chosen Malaysia as its first overseas investment location. This is one of the many success stories where the Malaysian Investment Development Authority (Mida) has facilitated to bring quality investments into the country.
“As a global leader in thin-tech innovation for copper foil manufacturing, we believe SK Nexilis’ presence will attract more investors to complete Malaysia’s EV battery manufacturing supply chain network, making us a hub for high precision and high quality copper foil for niche applications.
“Indeed, this investment will also boost Malaysia’s talent network and capabilities through initiatives with domestic universities and technical institutes. Despite the ongoing pandemic, Mida continues to draw high technology investment such as these into the country to provide tangible opportunities for innovation and local supply chain development. This is value creation which will boost our local industry’s ecosystem and competitiveness,” added Azmin.
The company has already improved productivity by enhancing its fourth factory facility in the Korea, which began its commercial operation this year, by strategically including wireless vehicles and robots. SK Nexilis looks to upgrade further its fifth and sixth factories in Korea as well. It will introduce state-of-the-art automation in its Malaysian facility, by integrating the world’s best technology and its know-how from enhancements made to its factories in South Korea; building the world’s best copper foil production facilities in Malaysia.
Notably, the proposed facility in Malaysia will also fully implement the RE100 initiative, an initiative towards committing to 100% renewable electricity, for the first time in the industry. This move is part of the company’s proactive response to requests from major global customers who want to increase the proportion of RE100 materials within their supply chain.
Six of SK group companies, including SK Nexilis’ parent company, SKC, are currently promoting RE100; the group was the first member of RE100 initiative in Korea. Hence, this facilities’ RE100 undertaking will further strengthen its environmental, social, and corporate governance (ESG) management.
In particular, Malaysia’s KKIP Industrial Complex, became the apparent choice for SK Nexilis’ investment in the region given its advantage in terms of power supply, which is key to copper foil manufacturing. Malaysia provides the most stable and competitively priced electricity supply among its Southeast Asian counterpart. The selected site also has excellent infrastructure such as gas and water and high accessibility to ports and large international airports which are required for exports.
SK Nexilis is also considering further investments in Malaysia, Europe and the US to quickly respond to the rapidly growing EV market. According to SNE Research, the EV market will increase by 41% annually and the battery market by 38% by 2025.
“We will be able to respond more quickly to customer requests by establishing a production facility in Malaysia with the best technology to produce the world’s thinnest copper foil for secondary batteries. This facility will also have the technological capabilities to produce various specialised products as per our customers’ requests.
“By entering Malaysia, SK Nexilis will secure cost competitiveness and reinforce our ESG management such as implementing RE100, while accelerating global expansion with additional investments. This will solidify our position as the global number one copper foil manufacturer,” an official from SK Nexilis shared.
SK Nexilis is currently in the midst of submitting their application for manufacturing licence to Mida.