SK Innovation, South Korea’s top petrochemicals company, said Friday it will end a battery-cell joint venture with German partner Continental AG due to slow growth in demand for electric cars.

SK Innovation and Continental, Europe’s second-largest car parts maker, established a joint venture in January 2013 to develop and produce lithium-ion battery systems for vehicles. Although the companies agreed to invest 270 million euros ($336 million) over five years, they are ending the partnership early due to weak market demand for battery-powered vehicles amid limited infrastructure and falling oil prices.

In a regulatory filing, SK Innovation said it will buy a full stake in the Korean branch of the joint venture at 14.48 billion won ($13.87 million) via off-board transactions within this year to dissolve it.

“We decided to withdraw the battery cell business because clean diesel vehicles were selling more than electric vehicles in the European market,” an official at SK Innovation said. “We will continue to research and develop batteries for electric vehicles in the future.”

Global electric car sales are expected to remain shy of 1 million in 2020, less than 1 percent of the entire vehicle market, according to market researcher IHS Automotive. Drivers have been put off hydrogen fuel cell and electric vehicles because of their high price and fears they may become stranded with nowhere to recharge.

Global oil prices plunged to a four-year low on Friday as the Organization of Petroleum Exporting Countries decided not to cut production despite a supply glut, coupled with rising production from U.S. shale drillers. (Yonhap)