LD Carbon investing in South Korean rCB plant with Toyota growth fund

SEOUL, South Korea—The OEs in automotive are investing at a greater pace in recovered carbon black, both in the scale of production for the more sustainable additive and in the processing technology.

As such, LD Carbon will use a Toyota-backed $28 million investment to expand rCB and tire pyrolysis oil capacity at its Gimcheon plant.

"Our mission is to dramatically improve the sustainability profile of the automotive industry, while lowering costs," said Seong Mun Baek, CEO and co-founder of LD Carbon. "Partnering with Woven Capital and other strategic investors will give us invaluable insights into scaling operations to support global OEMs as they seek to offer more sustainable vehicles to discerning consumers and business customers.

"Together, we can ensure automotive and its related industries are more environmentally friendly than ever while meeting high standards for cost and performance."

Woven Capital, Toyota's growth fund, states it will look to "advance the circular economy by diverting used tires from landfills and supporting development of high-performance recycled car parts."

The expansion and funding was announced in participation with Meritz Securities, Investwith, Industrial Bank of Korea, Hyundai Motor Group ZER01NE, Elohim Partners and New Main Capital.

"LD Carbon is solving a tough chemistry problem that continues to challenge manufacturers across the automotive supply chain as they face increasing pressure to embrace sustainability goals," said Prashant Bothra, a Woven Capital principal who is joining the LD Carbon board. "With a major plant under construction, the company is scaling their proven technology to maximize productivity and reduce the cost of creating high-performance recovered carbon black, offering substantial value compared to virgin materials."

With regulatory and corporate tailwinds and market share in Asia, Woven Capital believes LD Carbon "is well-positioned to play an important role in the sustainable future."

LD Carbon uses end-of-life vehicles rather than solely ELTs as feedstock, giving other non-tire rubber car parts a circularity as well.

The Gimcheon plant has capacity for about 7,000 tons of rCB annually.

LD Carbon has entered a decade-long supply agreement with SK Incheon Petrochemicals for its tire pyrolysis oil.

LD Carbon also is investing in the construction of Asia's largest tire pyrolysis plant in Dangjin City, Chungcheongnam-do, with completion set for sometime later this year.

Its annual feedstock will be 50,000 tons of ELTs, converted into 23,000 tons of TPO; 20,000 tons of rCB; and 7,000 tons of other valuable gas and materials.

Production of carbon black is a CO2-intensive process, as the industry generates about 25 million metric tons annually, with an additional 1.6 million metric tons of CO2 generated by the nearly 30 percent of ELTs that are incinerated each year, according to LD Carbon.

As the push toward sustainability increases, automakers are adopting increased recycled content for vehicles. This demand is driven, in part, by European Union proposals.