[아이뉴스24 장유미 기자] LG Electronics is starting to work in earnest to grow its electrical equipment business into future food. In particular, it is planning to officially launch the electric vehicle powertrain (power transmission system) related business in VS business headquarters in July this year.
LG Electronics announced on the 25th that it will proceed with the approval process for the division plan for the electric vehicle powertrain related business of the VS Business Division at the regular shareholders’ meeting held at the Twin Towers in Yeouido, Seoul at 9 am on the 24th of next month.
With this incident, LG Electronics’ expectations for the expansion of its electrical equipment business have increased. Earlier, LG Electronics held an extraordinary board meeting at the end of last year and announced that it would establish a joint venture in the field of electric vehicle powertrain with Magna International Inc., the world’s third largest auto parts maker. In addition, at this general shareholders’ meeting, it was decided to split the materials for electric vehicle powertrain related projects within the VS business division. LG Electronics, a spin-off company, will have 100% stake in the new spin-off company through the physical spin-off, and Magna plans to acquire a 49% stake in the spin-off company.
The joint venture will be officially launched in July this year when approval for the physical division is approved at the general shareholders’ meeting.
In the industry, it is predicted that Magna’s engineering capabilities, such as powertrain integrated system design and verification, and LG Electronics’ technology and manufacturing competitiveness for motors and inverters, create synergies, thereby exerting competitiveness in the rapidly growing electric vehicle market. It is also observed that it will have a positive effect on LG Electronics’ customer base expansion.
Park Kang-ho, a researcher at Daishin Securities, said, “LG Electronics has a high global share in the infotainment sector, but its portfolio centered on single products can be seen as a weakness.” On the side, cooperation with global automakers will be expanded.”
According to market research agency IHS Markit, the global electric vehicle market, which recorded about 10 million units last year, is expected to reach 15 million units this year, 20 million units in 2022, and more than 40 million units in 2025.
With the growth of the electric vehicle market, the scale of the electric vehicle market such as motors and inverters is also expected to grow rapidly. In the industry, the global electric vehicle motor and inverter market is expected to grow by an annual average of 26% by 2025. The electric vehicle motor market is expected to grow by more than 3 trillion won from 6.2 trillion won last year to 9.5 trillion won this year, and will reach 24 trillion won by 2025. The electric vehicle inverter market is also expected to reach 21.5 trillion won in 2025 from 5.66 trillion won last year.
With such a good trend in the electric vehicle market, the industry predicts that LG Electronics’ joint venture will record 500 billion won in sales this year. LG Electronics also said in a conference call last month, “In the case of joint ventures, we expect an annual average growth of more than 50%,” and “from 2024, 10% of the total sales of the electronics business will be generated by synergy with Magna.”
Meanwhile, LG Electronics plans to approve the financial statements, approve the revision of the articles of incorporation, appoint directors, appoint directors to become members of the audit committee, and approve the compensation limit for directors at this shareholders’ meeting. CFO Vice President Bae Doo-yong will be reappointed as the executive director, and Kang Soo-jin, a professor at Korea University Law School, will be appointed as an audit committee member.
In addition, it plans to approve an agenda to raise the dividend to KRW 1,200 per common share and KRW 1,250 per preferred share.
An official from LG Electronics said, “We will introduce the electronic voting system from this general shareholders’ meeting so that shareholders can exercise their voting rights more conveniently.” said.
Reporter Jang Yoomi [email protected]