With the exit of the mobile market, LG is entering a new phase of activities in cooperation with the Canadian company Magna International, one of the main suppliers of auto parts in the world.
It’s been a while since LG decided to exit the smartphone market. The Korean tech giant now plans to replace parts of its former revenue with the production of parts related to electric vehicles in its mobile-related industries.
Canadian company Magna, one of the world’s leading suppliers of auto parts, has partnered with LG to launch a company called Magna E-Powertrain, with a 49% stake in Magna and a 51% stake in LG. Is. It is headquartered in Incheon, South Korea, and branches of the company are being built in Michigan, USA, and Nanjing, China, to supply parts of the two countries’ markets.
Magna’s customers include major automakers such as General Motors, Biamo and Ford. As a result, LG can access a larger market than ever before.
LG made about 41 percent of its revenue last year from home appliance sales and another 24 percent from smartwatches and smart TVs. Auto parts production has generated $ 5.1 billion in sales for LG, which accounts for about 11 percent of the company’s revenue. The choice of LG by Magna could be due to having the necessary technology to manufacture equipment for electric vehicles, including engines and batteries.
Durable home appliances such as refrigerators and air conditioners, which depend on motors and compressors, have led LG to specialize in producing electrical products with good durability and optimal energy consumption. Also, the company’s research and development unit has been able to record many innovations in recent years. Other parts of LG, such as the LG Chem, have great potential for use in the electric vehicle market and can offer many services in the field of battery production. LG Innotek and LG Innotek can also be used to build car screens and cameras.
LG recently announced a joint venture with Tesla to produce batteries. LG’s new plant will be based in the United States or Europe and could make a big contribution to Tesla’s battery shortage. Many electric vehicles in the Chinese market now also use LG batteries.