Soon LG phones will be a relic of the past, as the company announced in April that on July 31 it will kill its mobile business worldwide.
To compensate for its losses in the smartphone market, the South Korean company will turn to the profitable EV industry. But don’t expect an G- or V- EV series. LG will focus on what it knows best: electronics, only this time for auto parts.
To that end, also on July 31, the company will officially embark on a joint venture with Canada’s Magna International, one of the world’s leading auto parts suppliers. LG has taken on a 51% stake in the enterprise. Interestingly, the agreement had already been announced in December 2020, but was pending until now shareholder and regulatory approvals.
The so-called “LG Magna e-Powertrain” will have its headquarters in Incheon in South Korea, but plans are underway for constructing bases in Michigan, US and in Nanjing, China, to secure customers from the biggest EV markets.
The joint venture will manufacture “e-motors, inverters and on board chargers, and related e-drive systems to support the growing global shift toward vehicle electrification.” While Magna International will provide its expertise on electric powertrain systems, LG will bring to the table its knowledge in component development for e-motors and inverters.
That’s a very good deal for LG, given that Magna’s customers include General Motors, BMW, and Ford.
In fact, according to information disclosed to Nikkei Asia, LG predicts that the vehicle components division will make an investment return for the first time in six years in 2021. For that reason, the company plans to expand its sales by 15% per year, which is expected to pay off more than $8.8 billion (10 trillion won) by 2024.
Well, personally I won’t miss LG phones much, which I always found quite inconvenient, but I do hope the company will advance EV tech. Better luck this time, LG.
Do EVs excite your electrons? Do ebikes get your wheels spinning? Do self-driving cars get you all charged up?
Then you need the weekly SHIFT newsletter in your life. Click here to sign up.
Get the Shift newsletter
Get the most important mobility news in your inbox each week.Follow @shift_tnw