[Featured Stock] LG Chem Plummets 10% Amid GM Bolt Recall

[Asia Economy Reporter Song Hwajeong] LG Chem is experiencing a sharp decline of over 10%.

As of 2:27 PM on the 23rd, LG Chem was trading at 807,000 KRW, down 91,000 KRW (10.13%) from the previous day.

This sharp drop is interpreted to be due to the recall impact of the GM Bolt. GM decided to recall 68,000 units of the 2017-2019 Bolt models in July, and additionally decided to recall 72,000 units of the 2019 and 2020-2022 Bolt models. GM explained the reason for the recall as "In rare cases, a manufacturing defect may occur where the anode tab in the same battery cell is torn and the separator is folded, increasing the risk of fire." Researcher Park Yeonju from Mirae Asset Securities stated, "For the affected battery modules, the cells were supplied by LG Chem and the modules by LG Electronics. At the time of the July recall, LG Electronics set aside a provision of 234.6 billion KRW and LG Chem set aside 91 billion KRW," adding, "There is a high possibility of additional provisions being set depending on the results of future investigations." Researcher Park said, "Although LG Chem's stock price fell sharply due to the GM recall issue, even considering a provision ratio similar to Hyundai Motor's case, the stock price drop on the day was excessive," and added, "Short-term volatility is expected, but from a mid- to long-term perspective, this is considered a process for growth."

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