The South Korean battery maker aims to achieve an annual production capacity of 200GWh for 2022 and 520GWh by 2025
LG Energy Solution to allocate $5.54bn in 2022 towards battery manufacturing. (Credit: Lee Rosario from Pixabay)
LG Energy Solution (LGES) has revealed plans to invest nearly KRW7 trillion ($5.54bn) in global capital expenditures in 2022 to maximise its battery manufacturing capacity.
The South Korean battery manufacturing firm is targeting an annual production capacity of 200GWh for 2022 and 520GWh by the year 2025.
LG Energy Solution expects 41% of its battery capacity in 2025 to account for North America, 37% in Asia, while Europe will get 22%.
The company is engaged in developing lithium-ion batteries for electric vehicles (EVs), mobility and IT applications, and energy storage systems (ESS).
Its investment plans were announced as part of its first-quarter results for 2022. The company’s consolidated revenue for the January-March quarter was KRW4.34 trillion ($3.43bn).
LG Energy Solution aims to enhance profitability amid rising metal prices by implementing certain measures.
Apart from strengthening partnerships with its suppliers, the company plans to procure raw materials under long-term agreements and via strategic equity investments.
To counter the fluctuating metal prices, the South Korean firm intends to grow the coverage of the cost pass-through schemes by adding copper, manganese, and aluminium to the current list of lithium, cobalt, and nickel.
LG Energy Solution CEO Youngsoo Kwon said: “Despite global economic uncertainties, LG Energy Solution will continue to make prudent investments to revamp quality and raise product competitiveness.
“As a responsible and loyal business to our partners, shareholders and investors, LGES will lead the energy industry toward a battery-powered future with unrivalled competitiveness.”
Last month, the company said that it will jointly invest over $4.1bn alongside Dutch automaker Stellantis to build an EV battery manufacturing facility in Canada. The EV battery manufacturing plant to be located in Windsor, Ontario is expected to have an annual production capacity of more than 45GWh.