South Korean battery manufacturer SK On announced on Thursday plans to implement voluntary redundancy programs as part of a strategy to enhance efficiency and competitiveness in a challenging electric vehicle (EV) market. As a key supplier of EV batteries to major automakers including Ford, Hyundai, and Volkswagen, SK On has been significantly impacted by a slowdown in EV sales. The company, which is the battery division of SK Innovation, aims to streamline its operations through voluntary departure options and special leave initiatives.
In a statement, SK On emphasized that these measures are designed to create a leaner workforce capable of adapting to fluctuating market demands. “While we strive for sustainable growth, we remain committed to supporting the career development of our employees who have contributed to our success,” the company said.
The broader automotive industry has also felt the pinch, with major manufacturers like Ford and General Motors postponing or canceling plans for new electric models due to lower-than-expected consumer interest. In a related move, Swedish battery maker Northvolt recently announced it would cut 1,600 jobs—about 20% of its workforce—due to production challenges and intensified competition, particularly from Chinese firms.
As part of its workforce reduction plan, SK On will offer a voluntary departure package that includes a retirement option for employees who joined prior to November 2022, providing 50% of their salaries for early retirement. The company reported a workforce of 3,558 as of June 2023, according to regulatory filings.
Despite its position as a leading battery manufacturer, SK On has faced financial difficulties since its separation from SK Innovation in 2021. The company posted an operating loss of 460 billion won (approximately $346.1 million) in the second quarter of 2023, an increase from a loss of 332 billion won the previous quarter.