Skip to content
 

LG Chem outlines ambitious new battery materials strategy

*

Korea’s LG Chem has outlined its new business strategy intended to help it to become a top global battery materials company. As part of this it told investors this week about its plans for its three new growth engines by 2030.

LG Chem CEO Shin Hak-cheol said this week that LG Chem is aiming to grow its battery materials sales sixfold to KRW 30 trillion (USD 25.5 billion) by 2030, from KRW 4.7 trillion (USD 3.9 billion) in 2022.

In detail, LG Chem’s sales from the three sectors which the company is counting on to power its growth – battery materials, sustainability business and innovative new drugs – is expected to make up 57% of the company’s total sales (by reaching KRW 40 trillion, or USD 30 billion) in 2030.

The three areas accounted for 21% (with KRW 6.6 trillion, or USD 4.9 billion) of the company’s sales in 2022. This will mark a turning point in LG Chem’s business as it aims to become a “top global science company”, shifting from a petrochemical-centric portfolio.

“Despite under an emergency management amidst the never-before pandemic and geoeconomic conflicts, LG Chem has been proactively fostering new growth powers based on global megatrends and strategies on sustainability,” said Shin “You will be able to see and feel LG Chem’s axis moving towards the next big three engines: battery materials, sustainability businesses and innovative new drugs.”

Battery materials strategy

LG Chem says it plans to “leap forward” as the world’s leading battery materials provider with KRW 30 trillion (USD 25.5 billion) in sales by 2030, backed by a compound annual growth rate of 26%. That said, the company also plans to cultivate its business in additional battery materials such as separators and carbon nanotubes (CNTs), in addition to the already-prominent cathode materials. LG Chem will also actively promote R&D efforts in new materials including pure silicon anode materials and solid-state battery electrolytes.

In particular, LG Chem claims it is set to secure its global leadership in high-nickel cathodes around three key areas – market, technology and metal sourcing.

LG Chem plans to strengthen its market leadership by establishing a global quadrilateral production system, connecting Korea, China, the U.S. and Europe, to make cathodes. This will help it to expand its production capacity from 120,000 metric tons in 2023 to 470,000 metric tons by 2028. 40% of LG Chem’s clients will be new global companies besides its subsidiary LG Energy Solutions,


Technology leadership

The company will also try to tighten its technology leadership by expanding its high-nickel cathode product line-up for pouch-type and cylindrical batteries, mass-producing ultra-high-nickel cathodes with nickel content of 95% and extending the application of single crystal cathode materials technology in the sector.

Also important are its global partnerships, which will be needed to secure its metal supply chain. In China, North America, Australia and Korea, LG Chem is carrying out various initiatives such as establishing joint ventures (JVs) for precursors, signing lithium contracts, and making equity investments with major players including Huayou Cobalt, Piedmont Lithium and Korea Energy Management Cooperation (KEMCO).

Separator market

In the separator market, LG Chem plans to grow its footprint in the U.S. and European markets. To that end, it will join forces with Toray to weave its exclusive, world-class coating technology and the unique fabric technology of the Japanese materials company. LG Chem forecasts more business opportunities as separators are classified as battery components as per the U.S. Inflation Reduction Act (IRA).

LG Chem also says it is planning to expand its business in additional battery materials such as CNTs, anode binders and cathode dispersants by seeking opportunities for partnerships based on LG Chem’s technological advantages. Its CNTs, for instance, use cobalt-based catalysts made with proprietary technology which helps lower the content of magnetic impurities that can affect battery quality.

In addition, LG Chem plans to explore growth opportunities based on innovative materials technologies such as pure-silicone (Pure-Si) anode materials, electrolytes for solid-state batteries and flame-resistant battery materials like aerogels.

Looking for great investing ideas? Sign up to our free newsletter.

This article does not constitute investment advice. Make sure you do your own research or consult a professional advisor.

'How to' Guides

Our latest in-depth company reports

Detailed reviews of selected companies and investment trusts.

On the podcast

Sign up for great investing stock tips

Thanks to our Site Partners

Our partners are established, regulated businesses and we are grateful for their support.

Aquis
FP Markets
Pepperstone
WisdomTree
CME Group
Back To Top