LG Energy Solution Q2 Profit Surges to 91 Billion KRW Market Share Falls to 10% Despite North America Push

LG Energy Solution (LGES) posted a net profit of 91 billion KRW (approx. $67 million) for Q2, swinging back to profit from a 24 billion KRW loss a year ago. Operating profit soared 152% year-on-year to 492.2 billion KRW ($360 million), mainly boosted by $360 million in U.S. production incentives under the Inflation Reduction Act. Excluding these credits, LGES returned to profitability after five quarters.

The company benefited as major customers—including Tesla, GM, and Volkswagen—stockpiled batteries ahead of potential U.S. tariffs. However, global electric vehicle (EV) demand faces headwinds as a $7,500 EV tax credit is set to expire October 1 and economic pressures mount. Both GM and Tesla have warned of sales impacts from new tariffs and shrinking incentives.

Despite a robust profit rebound, LGES faces shrinking market share, dropping from 13.5% in 2023 to 10% so far in 2024. Battery usage by LGES clients fell 13.3% in the first five months, especially in Europe, as Chinese players like CATL and BYD continued to grow rapidly.

To seize new opportunities, LGES is fast-tracking LFP battery production for energy storage, launching a year ahead of schedule. The company paused construction of its Arizona ESS battery plant, instead ramping up output at its Michigan site, aiming for 17GWh annual capacity by year-end.

A milestone was reached with a deal to supply 8GWh of “46 series” cylindrical batteries to Chery, marking the first such contract between a Korean cell maker and a Chinese automaker.

Looking forward, LGES warns of uncertainty as U.S. tariffs and subsidy changes threaten to inflate EV prices and curb demand in North America. The company’s revenue for Q2 dropped 11.2% sequentially and 9.7% year-on-year to 5.565 trillion KRW ($4.14 billion). The second half remains highly unpredictable amid global competition and policy shifts.