LG Energy Solution Ltd. has secured another battery supply agreement with Mercedes-Benz Group AG, extending what has become the South Korean manufacturer’s most prolific automaker relationship.
The ₩2.06 trillion ($1.4 billion) contract covers deliveries to North American and European markets from March 2028 through June 2035, according to a regulatory filing Monday. The company did not disclose battery volume or specifications.
Industry analysts expect the agreement involves 15-20 gigawatt hours of lithium iron phosphate cells destined for mid-range vehicles—a departure from earlier Mercedes contracts focused on premium applications. Previous agreements centered on high-energy 46-series cylindrical batteries for luxury models.
The deal represents roughly 8% of LG Energy’s annual revenue and marks Mercedes-Benz’s continued pivot away from Chinese suppliers like CATL and Farasis Energy. European carmakers face mounting pressure from EU carbon-footprint regulations taking effect next year, which require lifecycle emissions tracking across battery production chains.
Mercedes-Benz CEO Ola Källenius visited LG’s Seoul headquarters last month to discuss expanded collaboration. The automaker plans to introduce more than 40 new models by 2027, requiring diverse battery solutions across price segments.
Combined with earlier agreements—a 50.5-GWh contract last October and September deals totaling 107 GWh worth approximately $11 billion—LG Energy has positioned itself as Mercedes-Benz’s primary battery partner for Western markets.
