Kim Dong-myung, president of LG Energy Solution, emphasized that there is a high likelihood of encountering difficulties in generating revenue this year due to the electric vehicle chasm (temporary demand slowdown) and competition with Chinese companies, but the crisis should be seen as an opportunity for future growth and leap.
In a New Year's address delivered on the 2nd, Kim noted, "Last year's factors included an economic downturn, but we had an unprecedentedly difficult time because we failed to secure fundamental competitiveness to address changes," adding that "the business environment this year is also very challenging."
He explained, "As geopolitical issues are conveyed in real time, business prospects and market reactions are constantly changing, and the electric vehicle chasm is expected to recover only after 2026," and stated, "The aggressive global expansion of Chinese companies and cost competition poses a significant threat to us."
Kim reiterated that unprecedented challenges continued to arise, conveying his intention to focus more on expense reduction, organizational restructuring, and enhancing investment efficiency. Given that difficult circumstances are expected to persist for the time being, this is interpreted as a message to focus on strengthening internal capabilities.
He stated, "We must increase the efficiency of our investments and radically improve our organizational structure and expense structure in response to market changes," adding that "especially this year, meaningful revenue generation is likely very challenging, so short-term expense reduction activities are essential."
However, Kim projected a high possibility of recovering growth trends after overcoming this year's challenges. He noted, "The current crisis is temporary, and it is clear that it could be an opportunity for a larger leap and growth," asserting that "the electric vehicle market will gradually recover demand, focusing on next year and 2027, continuing medium- to long-term growth."
Kim remarked, "This year could be a critical time for us to become a turning point for future growth," and urged a focus on four key tasks: ▲ enhancing research and development (R&D) competitiveness ▲ securing product and quality competitive advantages that exceed customer expectations ▲ efforts to strengthen structural cost competitiveness ▲ innovation in future technologies and business models.