[Concall] LG Energy Solution "Complex Impact of EV Risks and Strengthened China Containment if Trump Elected"

On the 25th, LG Energy Solution stated during its Q2 earnings conference call that "if the current U.S. administration remains, the existing policy stance under the Inflation Reduction Act (IRA) is expected to continue; however, if there is a change in administration, there is a significant risk of a slowdown in electric vehicle demand growth." They added, "There is an advantage in terms of strengthened measures to counter China. We believe there are complex aspects involved."

LG Energy Solution explained, "Specifically, the Foreign Entity of Concern (FEOC) regulations will be tightened," and noted, "In the case of reducing the number of electric vehicle models eligible for IRA subsidies, such reductions are likely to be implemented through executive orders, which could pose a risk of slowing electric vehicle demand growth." They continued, "Regarding the Advanced Manufacturing Production Credit (AMPC), due to the complicated administrative and political processes involved, we expect that the tax credit for LG Energy Solution will largely be maintained within the framework of the legislation."

Furthermore, they stated, "Regardless of the political party, the policy stance to build a domestic-centered electric vehicle battery supply chain to counter China is expected to be maintained," and added, "As FEOC regulations tighten, making it more difficult for Chinese companies to enter the market, our position within the U.S. market will become even stronger in terms of competition." Regarding the supply chain, they said, "Based on the supply chain LG Energy Solution has already established, we will respond swiftly even if there are changes to the IRA policy."

On the 10th, LG Energy Solution headquarters on Yeouidaero, Yeongdeungpo-gu, Seoul. Photo by Jinhyung Kang aymsdream@

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