LG Energy Solution "GM Recall Agreement... Continuing IPO Efforts"

Module/Pack Full Replacement Cost Tentatively Estimated at 1.4 Trillion KRW

[Asia Economy Reporter Hwang Yoon-joo] LG Energy Solution announced that it has finalized an agreement with GM regarding electric vehicle battery fires and will continue to pursue its initial public offering (IPO).

On the 12th, LG Energy Solution stated, "The recent recall-related agreement among our company, LG Electronics, and GM has been smoothly concluded."

LG Energy Solution explained that the three companies conducted a joint investigation involving detailed product analysis and various tests, stating, "It appears that rare simultaneous occurrences of separator displacement and anode tab disconnection could be the cause of the fires."

They added, "For the recall, prioritizing consumer safety, early production units will undergo full module/pack replacement, while recent production units will be selectively replaced using diagnostic software."

LG Energy Solution said, "The replacement cost is expected to be approximately 1.4 trillion KRW but may vary depending on the progress. When setting accounting provisions between our company and LG Electronics, the cost-sharing ratio will be applied based on the midpoint of the current situation, and the final sharing ratio will be determined later according to each party's degree of responsibility."

Meanwhile, LG Energy Solution also announced that, with all matters related to the recall agreed upon, the IPO process, which had been temporarily suspended, will resume.

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