SK Innovation's electric vehicle battery subsidiary, SK On, aims to turn a profit in the fourth quarter by cutting costs, improving productivity, and receiving more US tax credits [57d56aed]. SK On reported an operating loss of $64.6 million in the third quarter, smaller than the previous year, as sales increased [57d56aed]. The company plans to achieve profitability through productivity improvements at overseas plants, increased benefits from the US advanced manufacturing production credit (AMPC), and cost reductions [57d56aed]. SK On collected $176.7 million of the AMPC in the third quarter, more than the previous two quarters [57d56aed]. The battery maker operates two plants in Georgia, with plans to expand capacity to 186 GWh by 2025 [57d56aed].
SK Innovation's total operating profit more than doubled in the third quarter, driven by profits in existing businesses such as refining, petrochemicals, and lubricants [57d56aed]. The refining unit recorded an operating profit of $1.1 trillion in the third quarter, despite a decline in sales [57d56aed]. The company's share price rose by up to 11.3% following the positive earnings report [57d56aed].
Meanwhile, SK Square, another subsidiary of SK Innovation, recorded sales of KRW 2.2765 trillion, an operating loss of KRW 2.3397 trillion, and a net loss of KRW 1.3148 trillion in 2023 [383dddd9]. The operating loss includes KRW 2.0526 trillion in actual value method losses from portfolio companies such as SK Hynix [383dddd9]. However, SK Hynix is expected to improve its performance this year [383dddd9]. SK Square secured a cash inflow of approximately KRW 1 trillion last year and achieved several portfolio rebalancing results [383dddd9]. SK Square also laid the foundation for investment in semiconductor manufacturing and plans to announce the results soon [383dddd9].
Panasonic Holdings Corp. expects its vehicle battery business to turn profitable in fiscal 2026-2027 even without U.S. government subsidies [0f3d1e8c]. The battery business is already profitable in North America, but struggling due to weak demand in Japan. The battery business posted a loss of 18.7 billion yen in fiscal 2023, with a forecasted loss of 17 billion yen in fiscal 2024 [0f3d1e8c]. President and Group CEO Yuki Kusumi said that EV adoption will increase with the availability of more chargers. Panasonic plans to ask for government support for battery production, as automobiles are a key industry for the country [0f3d1e8c].
Overall, SK Innovation's EV battery unit is aiming for profitability in Q4, while SK Square has recorded an operating loss in 2023. The company's total operating profit has increased, driven by profits in existing businesses [57d56aed] [383dddd9]. Panasonic expects its battery business to be profitable in fiscal 2026-2027, despite current losses and weak demand in Japan [0f3d1e8c].