Investment in Vietnamese production
LS Eco Energy plans to invest 64.9 billion won in Vietnam to establish a production facility for ultracapacitors (UCs) used in artificial intelligence (AI) data centers.
In a regulatory filing on October 26, LS Eco Energy said it would invest 64.9 billion won in a new medium-sized ultracapacitor cell production facility at its Vietnamese manufacturing subsidiary, LS Cable & System Vietnam (LSCV). It also decided to inject 35 billion won into LSCV through a paid-in capital increase to secure part of the investment funding. This represents approximately 54% of the total facility investment.
An ultracapacitor, also called a supercapacitor or supercap, is a high-power energy storage system. It stores less energy than a conventional battery but can supply a large amount of power over a short period. Its rapid charging and discharging make it suitable for industrial equipment requiring brief bursts of high power. Ultracapacitors are playing an increasingly important role in power generation systems for AI data centers in particular.
LSCV will build the production equipment on unused land within its existing Vietnamese factory. It plans to begin mass production in April 2027 and complete the facility investment by the end of June that year. LS Eco Energy aims to achieve annual ultracapacitor business revenue of approximately 150 billion won in 2030.
Production for LS Materials
The Vietnamese production facility is being established to support LS Materials' expanding overseas orders. On October 13, LS Materials signed an ultracapacitor supply contract worth approximately $51.5 million, or about 69 billion won, with a US hydrogen fuel cell company. Discussions on additional supply contracts are also underway, creating a need for expanded production capacity.
LS Eco Energy will manufacture ultracapacitors under an original equipment manufacturing (OEM) arrangement using technology held by LS Materials. LS Materials will be able to expand its supply capacity by adding the Vietnamese operation to its existing domestic production facilities. LS Eco Energy will gain a new revenue source beyond its existing wire and cable business.
Costs and market participants
LS Eco Energy plans to lower production costs by taking advantage of Vietnam's relatively low labor and utility costs, and will also review follow-up investment depending on additional orders. LS Eco Energy CEO Lee Sang-ho said, "We will develop ultracapacitors into a new growth business and expand into high-value products for AI data centers, including bus ducts."
Maxwell and Skeleton Technologies are considered leading companies in the global ultracapacitor market. In South Korea, LS Materials and VINATech have established themselves as major suppliers. Vitzrocell, Samwha Electric, Korchip and Pureechem are also pursuing related businesses.
Original Korean article: The Elec
English brief by Korea Wind Intelligence, koreawindintel.com
