View all newsletters
Receive our newsletter – data, insights and analysis delivered to you
  1. News
January 11, 2022

LG Energy Solution targets global EV battery leadership

Bullish LG Energy Solution aims to overtake CATL as world's largest EV battery supplier.

By Graeme Roberts

South Korea’s LG Energy Solution (LGES) said it aims to become the world’s largest manufacturer of electric/hybrid vehicle batteries, overtaking the current leader Contemporary Amperex Technology Company (CATL).

LGES CEO, Kwon Young-soo, revealed the ambitious targets during an online press conference ahead of the company’s IPO scheduled for the end of the month, when it expects to raise as much as KRW13trn (US$11bn).

He listed his company’s key strengths in this sector, including its perceived larger order backlog, strong intellectual properties (IP) rights and diversity in its foreign client base.

Kown said: “We overwhelm our competitor in terms of IP, we have a more diverse client base in the US and Europe and we have production bases in these regions to supply our clients, which CATL does not have.”

He added: “I believe that the backdrop to CATL’s growth is that Chinese automakers have preferred locally produced batteries, or have policies to use them. Since we have more orders, we predict that we will be higher than CATL in terms of market share in the future.”

Local research company SNE Research estimated CATL’s global market share was around 32% last year while LGES was second with 21%.

LGES recently revealed it had a cumulative order backlog worth KRW260trn (US$218bn).

LGES counts Hyundai, Kia, Tesla, Ford, General Motors, Renault and Volkswagen among its major customers and currently has plants in South Korea, China and Poland with combined annual capacity of 120 gigawatt hours (GWh) – enough to power close to 2m EVs.

The company is investing heavily to expand its global production capacity, including in the US where it is building 75 GWh in new capacity with General Motors as well as additional capacity of its own.

LGES said in a regulatory filing it plans to spend KRW8.8trn of the proceeds of the IPO to expand domestic and overseas production capacity, including KRW5.6trn in production facilities in Holland, in Michigan and KRW1.4trn in its Wroclaw plant in Poland.

The company is also understood to be discussing a new EV battery plant in Europe in partnership with a local automaker.

The company also plans to produce lithium iron phosphate batteries (LFP), which have better thermal stability than lithium-ion batteries and are currently produced mainly by the Chinese.

Kown said: “We plan to actively use this material. Since we’ve developed it before, we will apply it to ESS (energy storage systems) first and then to electric vehicles in the future.”

Free Report

What's next for the Automotive industry?

The theory of the peak car – particularly in the triad markets of the US, West Europe and Japan – and the need for sustainable transportation have driven the pivot to mobility in the automotive industry. Both of these drivers are motivating OEMs to change, while society at large is interested in sustainable transport.    GlobalData’s forward-looking report provides you with insights into the direction that the automotive industry is heading in the next few years. It covers: 
  • The forces transitioning automotive to mobility services 
  • CASE megatrends, and their relationship with COVID-19 
  • The way forward for autonomous vehicles 
  • Sustainability issues in automotive 
Examine the factors contributing to the future growth of different segments of the automotive industry.   Download the full report to align your strategies for success and get ahead of the competition.  
by GlobalData
Enter your details here to receive your free Report.

NEWSLETTER Sign up Tick the boxes of the newsletters you would like to receive. The top stories of the day delivered to you every weekday. A weekly roundup of the latest news and analysis, sent every Monday. The industry's most comprehensive news and information delivered every quarter.
I consent to GlobalData UK Limited collecting my details provided via this form in accordance with the Privacy Policy