BUSINESS

LG Group rules out producing its own electric cars

By Yonhap
  • Published : Sept 7, 2017 - 09:17
  • Updated : Sept 7, 2017 - 09:17

LG Group, which has been aggressively expanding its presence in the vehicle components sector, made clear it is not moving to build electric vehicles (EVs), industry sources said Thursday.

"We are not even considering manufacturing a complete vehicle," an LG Group official stressed.

Industry watchers have been speculating that LG Group may jump into car production as its affiliates recently expanded investment in the vehicle components businesses.

(Korea Herald DB)

Last month, LG Electronics Inc. said it will build a factory for the production of electric-vehicle (EV) parts in the United States. The factory is intended to produce battery packs for electrified cars and aims to gradually expand the scope of its operations to other key parts.

Other LG affiliates, such as LG Chem Ltd. and LG Display Co., produce car batteries and automotive displays, respectively. LG Hausys Ltd. and LG Innotek Co. also each supply materials and camera modules for automobiles.

Accordingly, industry watchers said LG Group will face no major hurdles in jumping into the automobile industry as it already holds business portfolios of related industries.

"As Samsung Electronics recently acquired US automotive firm Harman International Industries, the industries for EV equipment and parts are rising as a new growth engine," an industry insider said. "In the long term, we cannot rule out the possibility of Samsung and LG jumping into the EV business."

Other market observers, on the other hand, said LG Group is unlikely to kick off EV businesses in the near future, considering the firm will lose clients, which are mostly car manufacturers.

"LG Group is seeking to become a comprehensive automotive parts firm like Bosch and not Tesla, which builds complete EVs," another industry watcher said. (Yonhap)