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Two South Korean electric vehicle battery manufacturers said Sunday they have settled an extended trade dispute that will allow one of them to make batteries in the southern U.S. state of Georgia.
U.S. President Joe Biden, who has pushed for more electric vehicles in the United States as part of his clean-energy agenda, called the trade settlement "a win for American workers and the American auto industry."
The agreement between LG Energy Solution and SK Innovation ended the need for Biden to intervene in the dispute by a Sunday night deadline.
In a joint statement, the companies said SK will provide LG Energy with a total of $1.8 billion and an undisclosed royalty. SK has contracted to make batteries for an electric Ford F-150 truck and an electric Volkswagen SUV.
"We have decided to settle and to compete in an amicable way, all for the future of the U.S. and South Korean electric vehicle battery industries," the leaders of the two companies, Jun Kim of SK, and Jong Hyun Kim of LG Energy, said in the statement.
Democratic Senator Jon Ossoff of Georgia, who at Biden's request had initiated negotiations between the two companies, said the settlement "has saved the battery plant in Commerce, Georgia, ensuring thousands of jobs, billions in future investment, and that Georgia will be a leader in electric vehicle battery production for years to come.''
The dispute had threatened a $2.6 billion factory SK Innovation is building in Georgia.
Brian Kemp, Georgia's Republican governor, called the settlement "fantastic news for northeast Georgia and our state's growing electric vehicle industry.''
The U.S. has more than 279 million gas-powered vehicles, and the demand for switching to electric vehicles is expected to increase sharply in the next 15 years.
The Biden administration had until Sunday to decide whether to veto a ruling by the International Trade Commission in favor of LG in an intellectual property case. The ruling had threatened SK with a ban on supplying batteries in the U.S.