LG Energy Solution (LGES) recently reported a 75% drop in operating profit, attributing it to slow EV sales. The South Korean battery maker’s operating profit fell to $116 million in the first quarter, compared to about $470 million in Q1 2023. Additionally, LGES’ sales dropped by 30% to $4.5 billion in the first quarter, down from $6.4 billion in Q1 2023.
This news aligns with concerns previously expressed by Tesla CEO Elon Musk during an earnings call last year. LGES recently announced plans to invest in NCMA (nickel-cobalt-manganese-aluminum) and LFP (lithium-iron-phosphate) batteries, indicating a strategic shift in response to the market challenges. The financial performance of LG Energy Solution underscores the impact of sluggish EV sales on the battery industry.
This development may prompt further analysis and adaptation within the sector.