LS Eco Energy to Build Vietnam Production Base for 'AIDC Ultracapacitors' with 65 Billion Won Investment

Mass production to begin next April
OEM manufacturing arrangement

LS Eco Energy is expanding into high-value-added new businesses by starting production of ultracapacitors (UCs), a key component of power infrastructure for artificial intelligence (AI) data centers (AIDCs).

An overview of LS Eco Energy's production subsidiary in Vietnam. LS Eco Energy

LS Eco Energy said on October 26 that its Vietnamese production subsidiary, LSCV, has decided to invest approximately 65 billion won to build UC production facilities locally.

The investment is intended to meet orders for AIDC UCs placed with its affiliate LS Materials. On October 13, LS Materials signed a large-scale supply contract worth approximately $51.5 million (about 69 billion won) with a major U.S. hydrogen fuel cell company, and is also in talks on additional contracts before the end of the year.

LS Eco Energy plans to manufacture UCs under an original equipment manufacturing (OEM) arrangement based on LS Materials' technology. LSCV aims to begin mass production and supply in April 2027 and reach annual sales of approximately 150 billion won by 2030.

This will allow LS Materials to diversify its production bases between South Korea and Vietnam to meet growing global demand, while LS Eco Energy secures a new source of revenue through high-value-added businesses. The company also plans to consider follow-up investments depending on additional orders.

LSCV was considered a competitive production base in terms of costs because it can use idle space at its existing plant and has relatively low labor and utility costs. The UC business is expected to be more profitable than its existing general-purpose wire and cable business, and to contribute to improving LS Eco Energy's margins.

UCs are energy storage devices that rapidly store and supply electricity to compensate for temporary power shortages in hydrogen fuel cell power generation systems. As investment in hydrogen fuel cell power generation facilities expands in response to rising power demand from AIDCs, demand for UCs is also expected to grow.

Lee Sangho, CEO of LS Eco Energy, said, "We will develop UCs into a new growth engine and expand our business into high-value-added products for AIDCs, such as bus ducts."

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