By Ben Foldy 

Korean battery-making rivals SK Innovation Co. and LG Chem Ltd. have agreed to settle a trade-secret dispute that had threatened a $2.6 billion factory SKI is building in Georgia set to supply Ford Motor Co. and Volkswagen AG with electric-vehicle batteries, according to people familiar with the matter.

That plant's future had been in doubt after the U.S. International Trade Commission in February sanctioned SKI with a 10-year ban on importing batteries and the materials necessary to make them after finding the company destroyed evidence relating to the dispute.

The agreement between the battery makers hasn't yet been finalized, the people said. A spokeswoman for SK Innovation declined to comment.

The settlement comes just ahead of a Sunday deadline for the Biden administration to potentially veto the trade commission's decision. President Biden has made electric vehicles and the batteries that power them a core component of his proposed $2.3 trillion infrastructure program. As part of that plan, he has proposed investing $174 billion in spurring uptake of electric vehicles.

The fate of the Georgia factory has major implications for Ford and VW, which are counting on the new assembly complex to build batteries for electric models such as Ford's F-150 pickup truck and VW's ID.4 crossover. It is also important to the state, which swung in favor of Mr. Biden in the last election and gave Democrats control of the Senate.

SKI has said the plant under construction will create 2,600 new jobs, and Gov. Brian Kemp has described the factory project as one of the largest job-creation investments in the state's history.

Auto makers have prioritized securing a steady supply of the batteries necessary for mass-producing electric vehicles. Locating battery factories in the U.S. is a priority both for auto makers, for whom shipping heavy batteries between continents is expensive, and for the administration, which has said it sees them as necessary for creating jobs and remaining globally competitive.

(More to Come)

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(END) Dow Jones Newswires

April 10, 2021 16:00 ET (20:00 GMT)

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