LG Electronics to supply Daimler with $600 million electric car motors

LG Electronics to supply Daimler with $600 million electric car motors

On April 27, it is reported that LG Electronics recently signed an agreement with Daimler to provide electric vehicle motors worth US$600 million.

It is understood that LG Electronics has a close partnership with Daimler. LG Electronics has been supplying automotive touch panels to Daimler since 2018. In 2020, LG Electronics was selected as an excellent supplier by Daimler, the parent company of Mercedes-Benz. Daimler annually selects component suppliers that offer superior performance and partnership, and this is the first time LG Electronics has been selected.

According to industry sources, LG Electronics recently won the “Inspiration Division” award at the “Daimler Supplier Awards 2020” event held at Daimler’s headquarters in Stuttgart, Germany. This year, among more than 450 suppliers, Daimler selected 10 companies as outstanding companies in four aspects: sustainability, inspiration, quality and innovation.

It is understood that in 2013, LG Electronics newly established the VS (Automotive Parts Solutions) business headquarters, and officially launched related businesses, and won the Excellent Supplier Award from most vehicle manufacturers.

LG Electronics plans to focus its efforts on core businesses that can effectively utilize internal resources and secure a competitive advantage through the “Select and Concentrate” strategy. Taking the opportunity of cutting off the smartphone business, the company will focus on developing two fields of home appliances and electric vehicles.

Especially in the coming era of electric vehicles and autonomous driving, LG has accelerated the expansion of business related to auto parts. LG Electronics decided in July to form a joint venture with auto parts company Magna International Group to produce key components for electric vehicles. Earlier market rumors, LG Electronics will be Apple’s car OEM.

It is reported that LG smartphone production will end at the end of May. LG Electronics promises to continue to provide consumers with adequate after-sales service even after the handset business ends to prevent inconvenience to existing users. In addition, the loss of dealers and cooperative enterprises will be reasonably compensated. LG Electronics will not lay off the employees of the original mobile phone business unit, but will comprehensively consider redeploying them to other business units and LG subsidiaries.

Even if LG Electronics ends its mobile phone business, it will continue to develop core mobile technologies that focus on the future. Core mobile technologies such as 6G mobile communication and cameras are also required for next-generation home appliances, electric vehicle accessories, artificial intelligence, etc., so it is planned to continue research and development. In particular, LG Electronics plans to achieve 6G standardization around 2025, ensuring commercialization in 2029.

“Due to the end of the mobile phone business, the company’s sales may decrease in the short term, but in the medium to long term, it is expected to bring about an improvement in the business structure and finances,” LG said.

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