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On the 27th, LG Energy Solution announced that it recorded KRW 4.34 trillion in sales and KRW 258.9 billion in operating profit in the first quarter. Sales increased by 2.1% and operating profit decreased by 24.1% compared to last year. Despite overlapping negative factors including an increase cost of raw materials and a shortage of semiconductors for automobiles, the demand for cylindrical batteries for EVs remained and the market performance exceeded expectations.
 
LG Energy Solution pointed out the improvement it has made by minimizing the market impact with linking the price of major raw materials and increasing productivity through automation.
 
LG Energy Solution announced that it plans to invest KRW 7 trillion in facility to increase the capacity of global battery production this year. The expected amount of the total investment has increased as many new projects are planned such as joint ventures in North America, new and expansion of a single plant, as well as expansion of a cylindrical production line in China.
 
It anticipates to expand its global production capacity from the end of the year, 200 GWh (gigawatt hour) to 520 GWh by 2025.
 
The goal for sales this year is set at KRW 19.2 trillion, KRW 1.3 trillion increase compared to last year (KRW 17.9 trillion). LG Energy Solution plans to achieve its sales target by increasing sales of major products, including EVs cylindrical batteries, and new vehicle launches with major customers.
 
LG Energy Solution also disclosed improved profitability plans. It will actively respond to changes in metal supply and demand, and fluctuation of raw material prices. It will make a long-term supply contracts and strategic equity investments with major raw material suppliers such as lithium, nickel, and cobalt. LG Energy Solution plans to secure a stable supply line and increase price competitiveness. It will also expand the metal price interlocking from lithium, nickel, and cobalt to copper, aluminum, and manganese. LG Energy Solution plans to reduce risks of rise in prices of non-metal raw materials, such as anode materials, electrolytes, binders, and separators, by including them in the price list.
 
LG Energy Solution will accelerate in cost reduction and improve manufacturing competitiveness by building a smart factory based on automation, informatization, and intelligence in all global production bases.
 
LG Energy Solutions presented a plan for securing product competitiveness as well.
 
It will develop EV·ESS products based on new materials such as cobalt-free materials, and secure a heat diffusion suppression pack solution for pouch-type products. It will improve on safety and cost, and increase competitiveness of cylindrical products by developing high-capacity new form factor products.
 
CEO and Vice Chairman of LG Energy Solution Youngsoo Kwon said, “Despite the difficult situation in global business environment, we will continue to improve on product competitiveness and qualities."
 
Meanwhile, LG Display recorded sales of KRW 6.47 trillion and operating profit of KRW38.3 billion in the first quarter. Multiple factors resulted in lower earning due to decrease in product shipments with decrease in demand from off-season downstream industries, as well as decrease in price of liquid crystal display (LCD).
 
By Staff Reporter Taejun Park and Jiwoong Kim (gaius@etnews.com, jw@etnews.com)