SEOUL -- LG Chem will invest an additional 1.2 trillion won ($1.07 billion) to increase battery production capacity in the Chinese city of Nanjing, accelerating plans to create an export base for Europe and the U.S., the company said Thursday.

The move comes as the South Korean company struggles to break into China's market for electric-vehicle batteries owing to policies that favor domestic suppliers.

Half of the fresh investment goes to an automotive battery factory, with the rest devoted to a plant for smartphone and personal computer batteries. Nanjing approved the project on Wednesday.

In October, LG Chem broke ground on a second electric-car battery plant in Nanjing.

South Korean battery manufacturers are investing heavily to boost production capacity. SK Innovation looks to begin construction of a U.S. battery plant soon.

China, in an effort to nurture its electric vehicle industry, offers subsidies for some purchases of such autos. But the policy favors vehicles with batteries from Chinese companies.

LG Chem intends to use the Chinese output to penetrate other markets for now, hoping that Beijing will change the policy.