[Courtesy of LG Chem]
SEOUL -- LG Chem, a major producer of petrochemical products and batteries in South Korea, envisaged a sweeping change in its business structure to become a major global player in electric vehicle batteries through aggressive investments.
By 2024, the company will lower its petrochemical business, which currently accounts for about 60 percent of its total sales, to around 30 percent and raise its battery business to about 50 percent, Vice Chairman Shin Hak-cheol told reporters on Tuesday, vowing to boost battery sales in Europe and the United States.
Overall, LG Chem aims to achieve 59 trillion won ($50 billion) in total sales by 2024, Shin said, adding that the company would invest some 1.3 trillion won in R&D innovation this year and increase the number of people involved from 5,500 to 6,200.
"We will review strategic options for sluggish projects," Shin said, citing the establishment of joint ventures and the acquisition of assets.
Shin said that LG Chem would not be affected by a trade row between South Korea and Japan because the company has set up a diversified supply chain of raw materials in South Korea, Japan, China and Europe. "We have started to plan scenarios based on the assumption that regulations will be expanded as we cannot determine what will happen."
LG Chem has battery plants in South Korea, Europe, China and North America. Shin predicted that sales would pick up in China if Beijing ends its subsidy policy in the electric vehicle market.
In June, LG Chem agreed with Geely, a Chinese electric vehicle producer, to set up a battery joint venture. From 2020, Geely plans to convert 90 percent of its vehicles into electric cars. Geely acquired Volvo's passenger car division in 2010 and purchased a 9.69 percent stake in Daimler AG, the owner of Mercedes-Benz.
reporter
Lim Chang-won
cwlim34@ajunews.com
