The expansion of the electric vehicle market combined with the advancement of autonomous driving technologies is intensifying the electrification of vehicles. LG Electronics is accelerating its push into the market by maintaining an aggressive investment stance in its vehicle component solutions business, which it has identified as a future growth engine. In particular, it is fleshing out a strategy to strengthen its position in the future mobility market based on integrated automotive electronics capabilities that encompass both hardware and software.

Currently, LG Electronics’ vehicle component solutions business is operated around a “three-pronged” system consisting of the VS Business Division, which is responsible for in-vehicle infotainment (IVI); LG Magna e-Powertrain, which handles electric vehicle powertrains; and ZKW, which specializes in automotive lighting systems. These businesses respectively cover in-vehicle digital experiences, drive systems, and vehicle exterior and safety technologies, generating synergies across the entire automotive electronics value chain.

The core of the automotive electronics business is AI… Transforming into a “car that understands”

This trend was clearly visible at the Consumer Electronics Show (CES) in the United States earlier this year. LG Electronics presented a concrete vision of how AI can organically connect the in-vehicle experience and the entire journey. It defined the vehicle as a “platform” and set a direction to evolve it into an intelligent space that understands and responds to users’ lifestyles and contexts. This illustrates how mobility is expanding into a living space that provides personalized experiences.

In particular, a variety of solutions that allow users to tangibly experience AI technology, cited as the core of SDV (software-defined vehicle), attracted attention. A representative example is the front windshield with transparent OLED, which serves as an “augmented reality interface” that selectively provides information only when needed. Through this, the company demonstrated how it can simultaneously enhance safety and convenience based on analysis of the driver’s line of sight. In autonomous driving mode, the vehicle interior transforms into an immersive entertainment space, highlighting efforts to redefine the travel experience itself.

LG Electronics is seeking to preempt mobility competitiveness by moving beyond SDV to AIDV. With its telematics solution that integrates the TCU and antenna, the company is able to process 5G, GPS, V2X, and satellite communications within a single module, securing both minimal signal loss and stable data processing. Based on hardware miniaturization and advanced software algorithms, vehicles are being turned into data hubs, and AI is used to analyze drivers and environments in real time to autonomously optimize functions and services, thus realizing intelligent, personalized mobility.

The company’s automotive vision solution, part of its “AI-based in-vehicle solutions,” is also noteworthy. This solution analyzes the driver’s line of sight and condition and recommends the optimal driving environment for the situation, such as switching to autonomous driving mode if attention is distracted for a certain period of time. In addition, by using internal and external vehicle cameras to identify passengers’ interests and providing product information based on external billboard content that can lead to purchases through gestures, it presented new possibilities that combine mobility and commerce.

This type of technology is viewed as a turning point similar to when “rearview cameras” were first introduced. Once considered a technology of the future, rearview cameras have now become a standard feature, and it is widely expected that AI-based vehicle solutions will likewise become a basic element of automobiles in the future.

Another key concept presented by LG Electronics is “emotional intelligence.” Building on the AI technology accumulated in home appliances and robotics, the company plans to extend to vehicles its capability to understand users’ emotions and situations and interact with them. In practice, the natural movements and personalized services demonstrated by the home robot “LG CLOi” intuitively show the direction in which vehicles will evolve into user-customized spaces.

Automotive electronics market growing rapidly… Cars evolving into “electronic devices”

Market conditions are also supporting these changes. According to Strategy Analytics, the global automotive electronics market is projected to grow from about USD 400 billion (approximately KRW 520 trillion) in 2024 to USD 700 billion (approximately KRW 910 trillion) in 2028. For electric vehicles, the share of electronic components in total parts is expected to expand to as much as 70%. This demonstrates that the core of the automotive industry is shifting from mechanics to electricity and electronics.

However, some point out that the industrial base is still not sufficiently prepared relative to the sector’s growth potential. Of the approximately 9,300 automotive parts companies in Korea, it is known that only a little over 2% are capable of producing core electronic components for future vehicles. High technological barriers, strict safety regulations, and the accumulated know-how of incumbent players are cited as factors hindering new entrants. This also represents an opportunity for companies with the required technological capabilities.

In this market environment, LG Electronics has swiftly strengthened its position through preemptive investment and strategic partnerships. Starting with the launch of the VS Business Division in 2013, the company has built its automotive electronics portfolio through the acquisition of automotive lighting company ZKW in 2018 and the establishment of a joint venture with Magna in 2020.

The powertrain is a core component that encompasses the drive system, including the electric motor, inverter, and reduction gear. As it is responsible for the entire process of converting electrical energy into actual driving force and delivering it to the wheels, it is directly linked to improving energy efficiency and securing driving range. Given that battery capacity is limited in electric vehicles, how much energy efficiency can be improved is a key factor that determines competitiveness, and accordingly, the technological maturity of the powertrain is considered an important criterion that defines a vehicle’s fundamental performance.

Automotive lighting has also emerged as an important pillar of automotive electronics technology. Fundamentally, it is a safety device that facilitates communication on the road by transmitting signals between vehicles, but recently its role as a design element that shapes brand identity has greatly expanded. Headlamps and taillamps not only determine a vehicle’s first impression, but also perform functions directly related to safety, such as securing visibility and enabling pedestrian recognition during night driving. In addition, as intelligent lighting technologies such as adaptive driving beam (ADB) and pixel light, which adjust light patterns according to driving conditions, have advanced, convenience and information delivery functions have been further enhanced.

Powertrains and automotive lighting are thus core electronic components for electric vehicles, respectively responsible for “driving performance” and “safety and emotional quality,” and they are areas requiring high technological capabilities and extensive know-how. LG Electronics has actively pursued strategic collaborations and mergers and acquisitions to rapidly secure competitiveness in these two domains.

In the electric vehicle powertrain segment, the company established LG Magna e-Powertrain in partnership with Magna International, the world’s third-largest automotive parts supplier, thereby securing technology across motors, inverters, and drive systems. This has provided a foundation for supplying high-efficiency, high-performance electrification solutions that meet the requirements of completed vehicle manufacturers.

In the automotive lighting segment, LG Electronics significantly boosted its global competitiveness by acquiring Austrian lighting company ZKW. Recognized for its technological prowess in premium automotive headlamps, ZKW has enabled LG to secure both advanced lighting technologies and smart manufacturing capabilities. As a result, the company’s technology has been acknowledged with honors such as the “German Innovation Award.” LG is also expanding its global customer base of completed vehicle manufacturers by supplying lighting systems for Volvo electric vehicles and Jaguar Land Rover SUVs, among others.

LG Electronics is also accelerating its push into the North American market by building an electric vehicle parts manufacturing plant in Mexico. North America is a key market where global demand for electric vehicles is growing rapidly, and securing a local production base is viewed as a strategic choice that can simultaneously enhance supply chain stability and customer responsiveness.

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