Ecopro BM will invest about 40 billion won ($28.7 million) to overhaul production lines at its Hungary cathode factory, moving to supply high-nickel NCM (nickel-cobalt-manganese) cathode materials — with nickel content exceeding 90 percent — to European premium electric vehicle makers starting in the fourth quarter of next year. The company plans to broaden its local production lineup beyond NCA (nickel-cobalt-aluminum) to include NCM, accelerating efforts to win European automaker customers.
Ecopro BM said Monday it has begun converting the existing NCA cathode production line at its Debrecen, Hungary factory into a dual-use line capable of producing both NCA and NCM materials. The company is currently placing equipment orders and arranging shipments.
Both NCA and NCM are ternary cathode materials — NCA uses nickel, cobalt and aluminum as its primary components, while NCM uses nickel, cobalt and manganese. The conversion will allow Ecopro BM to expand its product range to meet the varying battery specifications of different European automakers.
Ecopro BM also disclosed its European business plans at an IR session for retail investors held Friday at NH Investment & Securities' headquarters in Yeouido, Seoul, saying it had "begun investing in the Hungary factory conversion to supply high-nickel cathode materials to German premium automakers."
The Hungary factory is Ecopro BM's first cathode production base in Europe. It began commercial operations in the first half of this year, and with all three production lines running, it can produce 54,000 tons of cathode materials annually — enough to supply roughly 600,000 electric vehicles.
Line 1 began full operations in June, and Line 2 is set to come online next month. Ecopro BM plans to produce about 10,000 tons at the Hungary factory this year before scaling up output to around 30,000 tons next year.
The Debrecen site houses not only the cathode factory but also material production facilities operated by other Ecopro Group affiliates. The group has established Ecopro BM for cathode production, Ecopro Innovation for lithium hydroxide, and Ecopro AP for industrial oxygen and nitrogen supply — all on a roughly 440,000-square-meter site in Debrecen.
Ecopro Innovation has an annual lithium hydroxide production capacity of 8,000 tons, while Ecopro AP can supply 16,000 cubic meters of oxygen per hour. The integrated setup — covering key raw materials through to finished cathode — is designed to cut logistics costs and reduce supply chain risk.
As Ecopro BM secures more European customers, improving the profitability of its Hungary unit has become a pressing task. The company is working toward a return to quarterly profit through higher output in the second half, line stabilization and improved operational efficiency.
Ecopro BM posted consolidated sales of 576.7 billion won and operating profit of 18 billion won in the second quarter of this year, maintaining a profitable trajectory. The company had already signaled at that time its intention to use the Hungary factory to proactively meet demand from European automakers.
Over the medium to long term, tightening EU requirements for local sourcing of battery materials are expected to work in the Hungary factory's favor. The combination of the EU-UK Trade and Cooperation Agreement and European automakers' push for regional production could drive up demand for European-made cathode materials.
Raw material supply will be linked to Indonesia. Ecopro Group plans to source nickel from the BNSI smelter it is building in Indonesia and use it as feedstock for the high-nickel cathode materials produced in Hungary. Because nickel accounts for more than 90 percent of high-nickel cathode composition, nickel prices and stable procurement are critical to cost competitiveness.
"The Hungary unit is expected to shift into full profit-generating mode from the fourth quarter," said Kim Jang-woo, chief executive of Ecopro BM. "We will strengthen partnerships with European automotive OEMs on the back of a stable supply chain and accelerate our push to improve profitability."
kwater@heraldcorp.com
