South Korean battery maker SK On to cut jobs amid challenging EV market

South Korean battery maker SK On said on Thursday it plans to introduce voluntary redundancy programmes aimed at cutting its workforce, as the company seeks to improve efficiency and remain competitive in a challenging electric vehicle market.

SK On, which supplies EV batteries to Ford Motor, Hyundai Motor and Volkswagen among others, is the latest battery maker to bear the brunt of slowing EV sales.

The company, the battery unit of energy group SK Innovation, said in a statement it plans to offer special leave and voluntary departure options as part of an efficiency scheme.

"These are proactive measures to establish a lean, agile workforce, so that we can better navigate shifting EV market conditions," SK On said.

"While the company pushes to improve efficiency and secure grounds for sustainable growth, we are fully committed to supporting the career development of our employees who have contributed to our success in becoming a top-tier battery maker," it said.

Ford, General Motors, and other car makers have delayed or cancelled new electric models to avoid spending heavily on vehicles that consumers are not buying as quickly as anticipated.

Northvolt said this week that it plans to cut 1,600 jobs at its base in Sweden, or about a fifth of its global workforce, as Europe's biggest hope in the EV battery market struggles with production problems, sluggish demand and competition from China.

As part of the efficiency measures, SK On said it is set to offer a voluntary package to employees who agree to leave, including offering staff who joined the company before November last year 50% of their salaries to retire early.

The company employed 3,558 people as of the end of June this year, a regulatory filing showed.

SK On, which has never made a profit since it was split off from SK Innovation in 2021, booked an operating loss of 460 billion won ($346.10 million) in the April-June quarter, versus a loss of 332 billion won in the previous quarter.

Shares of SK Innovation were trading down 0.9%, versus the benchmark KOSPI's 2.1% rise as of 0357 GMT.