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LG Energy Solution Ochang Energy Plant. (Photo=Yonhap News) |
[Alpha Biz= Reporter Kim Jisun] LG Energy Solutions saw its first-quarter earnings drop significantly. It is due to a number of negative factors surrounding the market, including slowing growth in the electric vehicle market and falling metal prices.
LG Energy Solutions announced on the 5th that it recorded sales of 6.1278 trillion won and operating profit of 157.3 billion won in the first quarter of this year. Compared to the same period last year, sales fell 29.9% and operating profit fell 75.2%. The operating profit included 188.9 billion won in the Advanced Manufacturing Production Tax Credit (AMPC) under the U.S. Inflation Reduction Act (IRA), which resulted in 31.6 billion won in operating losses.
The company is believed to have adversely affected its performance as the time lag in the price of raw materials continued due to sluggish demand for global electric vehicles and a drop in major metal prices that began in earnest from the second half of last year.
Among them, LG Energy Solutions has continued to invest in production facilities by announcing the construction of its second single plant in North America, the Arizona plant in the U.S.
The Arizona plant is the first plant of LG Energy Solutions that produces cylindrical 46-series batteries for electric vehicles and lithium phosphate iron (LFP) batteries for energy storage devices (ESS). A total of 7.2 trillion won will be invested, and its production capacity is 36 gigawatt hours (GWh) and ESS LFP battery 17GWh, which is equivalent to a total of 53GWh.
In addition, the second plant of Ultium Cells, a battery joint venture with General Motors (GM), has also entered commercial operation. The plant produced its first battery cell two and a half years after construction began and recently delivered it to its customers for the first time.
LG Energy Solutions plans to invest more than 32 trillion won by 2026 to expand its production capacity in North America to 342GWh.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
