As SK Innovation celebrated its 60^th anniversary in 2022, 2023 marks the beginning of a new 60 years of its history, and it is also the second year the company and all subsidiaries execute their Financial Story.

To learn more about the company’s strategies and plans for this year, we’ve met the executives of SK Innovation and its subsidiaries and asked them in detail. The eighth guest of this series is Kim Cheol-jung, the new President of SK IE Technology (hereinafter “SKIET), and he talked about how to provide our customers with integrated values in terms of technology, cost, global supply chain, and ESG.

Q1. This is your first year being the President of SKIET. We’d like to hear a few words regarding your determination and goals for 2023.

2023 is my first year working as the President of SKIET. It may sound obvious, but I surely have different feelings about SKIET before and after I became a part of it. Until last year, from my point of view SKIET was merely a subsidiary of SK Innovation that execute “Carbon to Green” strategy, but after becoming the President of SKIET, I found out that this is such a fascinating company with passionate members armed with robust technical skills, and I’m proud to be here.

To help SKIET become the Global No 1. LiBS (Lithium Battery Separator) and, beyond that, a top-tier green material company, I will try my best to constantly communicate with members and to closely cooperate with all divisions and parts of the company. 2023 will be a starting line for SKIET to take another great leap.

▲ Kim Cheol-jung was appointed as the President of SK IE Technology in December 2022.

Q2. Your first official activity of this year was attending CES 2023 held in Las Vegas in January with all the Independent Directors of SKIET. How did you feel about this experience?

It was my third visit to CES, but the first time as the leader of SKIET. As a member of SK, I was happy to see a long queue waiting to enter our exhibition at CES 2023. It was great to see how SK member companies own diversified and realistic portfolios required for carbon reduction, a vital task that mankind must solve. Furthermore, as the President of SKIET, I was proud that we won the Best of Innovation award along with the Innovation Award Honoree at CES this year.

Before attending CES 2023, I and the Board of Drmsepors of SKIET carefully examined the main implications, including key themes of the show and noticeable technical trends. That helped us understand the products and technologies of multiple companies at CES 2023 better and realized the keen technological competitions happening all around. In addition, when I toured around various booths related to electric vehicle (EV) and EV battery industry, I could really see how the relevant markets have been expanding, which made me more confident in the future of SKIET. CES 2023 was a good opportunity for the board of directors and management of SKIET to share new perspectives on the current issues and directions of the company management.

▲ (Left) President of SK IE Technology Kim Cheol-jung check the digital specification board of the company’s LiBS displayed inside SK booth at CES 2023. / (Right) Independent Directors and officials of the SK Innovation subsidiaries participate in a seminar prior to the opening of CES 2023 held in Las Vegas in January 2023.

Q3. Now let’s move on to talking about SKIET’s business. The EV battery market’s expansion is directly influencing the separator market, leading to its rapid growth. Do you think such a growth trend will continue?

While the EV market is growing rapidly, the market for LiBSs, which are major materials for EVs, have been growing together. Of course, there are many variables of uncertainties everywhere, such as geopolitical issues, global economic recession as well as unended COVID-19. We, however, do not doubt the future of the EV market.

Each country supports eco-friendly industries on a policy level to prevent climate change, and in this stance, countries such as the US and China and those in Europe are developing their EV markets competitively. Reviewing such a situation, we believe that the EV market will grow steadily.

In addition, it is true that the separator companies fiercely compete to gain dominant market share, alongside the growth of the EV battery markets. While Korean, Chinese, and Japanese companies are competing in the separator market, it is imperative for us to have market analysis from various angles with careful preparations in order to gain competitive edge.

▲ LiBS produced by SKIET, which developed the sequential stretching technology for the first time in the world.

Q4. So how is SKIET preparing to keep and strengthen its competitiveness to dominate the market under heated competition?

Expanding our customer portfolio is the most crucial task that will determine our growth in the future. To make it possible, we must provide our customers with integrated values in terms of technology, cost, global supply chain, and ESG. And I will explain them one by one.

First is technical competitiveness. SKIET is the first among Korean companies to enter the LiBS market, and also is the first in the world that developed the sequential stretching technology. As we have responded to the needs of our customers in advance, by further strengthening our accumulated product properties, productivity, and uniformity in quality, we will also respond to various customer needs in a timely manner.

Second is cost competitiveness. Under fierce cost competitiveness among the separator companies to occupy the markets, through innovation in productivity, automation and so on, as well as maintaining excellent properties and quality based on our differentiated technology, we have been securing our competitive edges that can dominate any region.

Third is the global supply chain. In order to meet the increased demand for the product in the overseas markets, SKIET has successfully set up production sites in China and Europe after first manufacturing base in Korea. So now we have a supply chain that can promptly respond to customer needs in different places. At the moment, our facilities are additionally under expansion in Silesia Province in Poland, and we are also studying the possibilities to advance to the North American market, where we expect high growth.

Fourth is ESG management. The separators produced by SKIET are the core components of EV batteries, which are recognized as eco-friendly products. Not remaining content with that, we are pursuing “clean plants” in the manufacturing process, and we will strive to accomplish zero waste in the production process and the introduction of eco-friendly electricity. We expect that our such efforts and sincere activities will bring us a very positive impact on enhancing the corporate value continuously.

Q5. In addition to the separators, what are SKIET’s next-generation core businesses that should be addressed?

Along with promoting the aforementioned strategy, in the mid- to long-term, SKIET is preparing to secure separator technologies for the next-generation EV batteries, such as semi-solid/all-solid batteries, and solid electrolytes technology. On top of this, SKIET is promoting green materials businesses as well by making use of its differentiated technological capabilities in membranes, coating, and synthesizing. SKIET will also continuously create opportunities for new businesses to lead the market with new perspectives.

I believe SKIET can successfully create new separators with new technologies based on our experience of consistently innovating ourselves to a sizable business. SKIET will write a new history through great teamwork with its members who have the best capabilities.

▲ Full view of SKIET Plant No.1 in Poland

Q6. In order to achieve the enhanced corporate value that you have mentioned, it seems it would be crucial to focus all capabilities of the company to execute them.

That is correct. In order to overcome a difficult business environment, we must pursue SUPEX ceaselessly. The core of the pursuit of SUPEX is organizational culture. It is important that the function of each organization makes contributions to achieving the goals of the company from the viewpoint of the company as a whole, not an individual stance. The most important thing to do so is that SKIET should act as “one body” to become an organization where each member’s words and thoughts freely flow without any obstacles.

For seamless communication among the members, first of all, they should actively share their concerns with each other. In order to know each other’s thoughts and difficulties, organizations and members must honestly share what they know and what they want. There’s no need to be scared even if there are disagreements due to different thoughts in the communication process, since they could be healthy conflicts for the company.

Through this seamless communication process, we can together reach the goals that we aim.

Q7. Finally, please share what you want from the members or what you would like to tell them.

I believe the message that SK Group Chairman Chey Tae-won has emphasized since last year, “turning a crisis into an opportunity by overcoming hardship,” is the most suitable direction SKIET can take when considering the company’s current status. Regarding the current competitive situation, I think it is a good opportunity for us to reinforce our fundamental competitiveness. I would like to keep Vice Chairman Kim Jun’s New Year message, “Overcoming a crisis can be an opportunity to strengthen the company’s constitution,” in my mind.

SKIET’s future is expected to be something more than its history so far. I am confident that if we are well prepared for the future, the company will be able to create greater happiness together with members and stakeholders. Even though our journey seems challenging and arduous, I would like to take the initiative and pioneer at the very front. Thank you.