LG Energy Solution reported a sharp decline in third-quarter profit as cooling demand for electric vehicles and intense market competition squeezed margins at the South Korean battery maker.
Operating profit dropped 39% to 448.3 billion won ($337 million) from a year earlier, the company said. Without U.S. tax credits worth 466 billion won, the Tesla supplier would have posted a loss. Revenue fell 16% to 6.88 trillion won.
The results highlight growing headwinds for battery manufacturers as major automakers from Ford to Volkswagen scale back their ambitious EV production targets. Still, LG Energy secured new supply deals totaling 160 gigawatt-hours, including a major contract for cylindrical batteries in North America.
CEO David Kim said the company will slow its capacity expansion plans and adjust production ramp-up speeds to maximize utilization of existing facilities. The battery maker is also diversifying its product lineup with new cell formats and chemistries while developing next-generation technologies like solid-state batteries.
