LG Chem announced on the 13th that it has signed a contract to supply cathode materials for electric vehicle batteries worth KRW 3.7619 trillion to a customer in the United States over the medium to long term.

LG Chem specified the supply location as the United States but did not disclose the specific customer. LG Chem stated, "It cannot be disclosed due to business confidentiality." However, industry sources suggest that the customer is likely either the U.S. electric vehicle company Tesla or the Japanese battery company Panasonic. Panasonic operates a plant in the U.S. and supplies batteries to Tesla. The contract period is from November 15 of this year to July 31, 2029.

The cathode materials contracted by LG Chem are estimated to amount to approximately 100,000 tons. LG Chem currently has an annual production capacity of 150,000 tons of cathode materials, operating plants with a capacity of 100,000 tons in Korea and 50,000 tons in China. It is expected that the cathode materials supplied to the U.S. under this contract will be exported from the domestic plant.

Cathode materials are a key component in battery manufacturing. After signing a contract in February last year to supply 950,000 tons of cathode materials worth KRW 25 trillion to General Motors (GM), LG Chem had not secured any large-scale additional orders for some time. The battery industry has been facing challenges this year due to prolonged stagnation in electric vehicle demand and uncertainties surrounding the U.S. Inflation Reduction Act (IRA). In addition to these challenges, LG Chem has been struggling with management difficulties due to the deterioration of the petrochemical industry, but it is expected that this order will provide some relief.

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