"Mercedes-Benz Chooses Samsung for 10 Trillion Won Deal, Reducing Reliance on Chinese Batteries... More Beneficiaries Expected [Weekend Money]"

Business Outlook Improves for Prismatic Cell Form Factor Value Chain Companies
Including SangsineDP and Shinheung SEC

Samsung SDI has signed a contract to supply electric vehicle batteries to Mercedes-Benz, and it is anticipated that not only Samsung SDI but also related value chain companies such as SangsineDP and Shinheung SEC could benefit from this deal.

Jang Jeonghun, a researcher at Samsung Securities, recently highlighted this in his analysis titled "The Significance of the Contract Between Mercedes-Benz and Samsung SDI." He stated that it is positive for Samsung SDI, which has been losing market share to Chinese companies in Europe in the prismatic cell form factor segment, as this contract increases the visibility of its capacity utilization recovery. He further added, "For value chain companies with prismatic cell form factors, such as SangsineDP and Shinheung SEC, the expansion of demand from not only energy storage systems (ESS) but also electric vehicles (EVs), along with increased capacity, could lead to improved industry conditions."

On April 20, Mercedes-Benz signed a contract with Samsung SDI for the supply of electric vehicle batteries. It is reported that Samsung SDI will supply high-nickel NCM prismatic cell batteries for Mercedes-Benz’s small and medium-sized electric SUVs. The supply is set to begin in 2028, with the total value of the contract expected to reach up to 10 trillion won. Following this announcement, Samsung SDI's stock price surged by 23% over the next two trading days.

Researcher Jang interpreted this as a signal that Mercedes-Benz is increasing the proportion of prismatic batteries in its lineup. As of last year, out of the 320,000 electric vehicles that Mercedes-Benz produced and sold in Europe, except for the 105,000 units equipped with prismatic CATL batteries, all the other models used pouch-type batteries. He explained, "It is possible that Mercedes-Benz is adopting a policy to increase the proportion of prismatic cell form factors, which are highly compatible with safety and next-generation low-cost batteries."

He also commented that Mercedes-Benz is building a new supply chain to reduce its heavy reliance on CATL. Until now, Mercedes-Benz has depended solely on CATL for prismatic cell form factor batteries. In addition, in line with the European Union's proposed IAA (Industrial Acceleration Act), which seeks to curb Chinese firms, Mercedes-Benz is securing local battery manufacturers and diversifying its supply chain beyond China. In fact, nearly half (46%) of Mercedes-Benz’s electric vehicles sold in Europe last year were equipped with Chinese batteries.

This content was produced with the assistance of AI translation services.