LG Energy Solution (LGES) has worked with the Stuttgart car manufacturer Mercedes Benz a supply contract for batteries for Electric cars signed. Accordingly, LGES will produce batteries with an output of 50.5 gigawatts per hour for Mercedes from 2028 to 2038, the South Korean company announced in a statement on Tuesday.
According to the Reuters news agency, delivery will be made to a Mercedes subsidiary in North America and other regions. LGES initially did not want to disclose which specific locations were involved in the deal or any further financial data. In response to the report, the battery manufacturer’s shares recently climbed by around 5 percent.
LGES wants to become more independent from the car market
The deal comes a day after the company announced its new strategy called “Empower Every Possibility.” Accordingly, LGES aims to to reduce its dependence on the car market and to diversify its portfolio overall
. “We have set global standards with our many years of experience in the battery industry and will maintain our status as an industry leader,” said David Kim, CEO of LG Energy Solution.
LGES also said it posted a 40 percent decline in operating profit to 448 billion won (300 million euros) in the third quarter. However, the group did better than analysts expected. The main reason for this was the expansion of battery deliveries to electric car manufacturers in the USA as well as to producers of energy storage systems. The full quarterly report is scheduled to be published on October 28th.
LGES is headquartered in Seoul and is one of the largest battery manufacturers in the world alongside CATL, Panasonic, SK Innovation and Samsung SDI. The company’s customers include Tesla, General Motors and Hyundai Motor.