LG Energy Solution Launches... Solidifying Battery 'World No. 1' Position

LG Chem Battery Division Independence

The First Domestic Company Specializing in Secondary Batteries

Sales Target of 30 Trillion KRW by 2024

Challenges Including IPO and SK Litigation

[Asia Economy Reporter Park So-yeon] The newly established corporation 'LG Energy Solution,' which spun off from LG Chem's battery division, officially launched on the 1st. LG Energy Solution has set a goal to achieve sales of 30 trillion KRW by 2024, three times its current revenue, solidifying its position as the global leader in the electric vehicle battery market. The company also plans to pursue an initial public offering (IPO) to attract large-scale investments.

On the day of its launch, LG Energy Solution held its inaugural general meeting and first board of directors meeting, appointing Kim Jong-hyun, head of LG Chem's battery business division (President), as the first CEO of the new corporation. President Kim is an LG veteran who has served as head of the small battery division, automotive battery division, and battery business division at LG Chem.

In his inaugural speech, President Kim stated, "LG Energy Solution pioneered South Korea's battery industry, which was once a barren land, with an indomitable spirit of challenge. Despite many concerns and adversities, we recently laid the foundation for structural profit generation in the electric vehicle battery business ahead of anyone else." He added, "Now, to realize even greater dreams, we have successfully completed the spin-off and embarked on a great journey." He emphasized, "This journey is toward becoming LG Energy Solution, a company that provides value beyond expectations with the best technology and quality, innovatively improves human life, leads eco-friendliness, and above all, offers the greatest value to all our members who grow with the company and take pride in it."

LG Energy Solution was established as a 100% subsidiary through the physical division of LG Chem. As the first domestic company specializing in secondary batteries, it will continue to operate with the same three existing business divisions: automotive batteries, energy storage system batteries, and small batteries. Furthermore, the company aims to become the world's leading energy solution company in the electric transportation (E-platform) sector by providing a wide range of services throughout the battery lifecycle, including management, leasing, charging, and reuse, beyond just battery manufacturing.

The company plans to increase its electric vehicle battery production capacity in 2023 to 260GW, more than double the year-end target of 120GW, and achieve total sales of 30 trillion KRW by 2024. The sales target for next year is in the high 18 trillion KRW range.

LG Energy Solution intends to expand investments timely by utilizing various financing methods to widen the gap with competitors. Although the company has not made any specific decisions yet, industry insiders expect LG Energy Solution to go public to attract large-scale investments. With an order backlog reaching 150 trillion KRW and annual facility investments of about 3 trillion KRW, an IPO is necessary for additional investments. The industry anticipates that LG Energy Solution could raise around 10 trillion KRW by issuing new shares upon listing.

The electric vehicle battery-related litigation between LG Chem and SK Innovation at the U.S. International Trade Commission (ITC), which began in April last year, will now be handled by LG Energy Solution. The final ruling on the main case concerning trade secret infringement has been postponed twice and is expected on the 10th. Competition with overseas battery companies such as China's CATL and battery safety controversies are also challenges that the newly launched LG Energy Solution faces.

This content was produced with the assistance of AI translation services.