LG Energy Solution recently stated that it is preparing various scenarios in response to the policy direction of the newly inaugurated U.S. President Donald Trump.

During the conference call for last year's fourth-quarter earnings announcement, LG Energy Solution noted, "We are preparing countermeasures for the policies mentioned by President Trump by scenario. We plan to respond proactively."

LG Energy Solution 4695 cylindrical battery. / Courtesy of LG Energy Solution
LG Energy Solution 4695 cylindrical battery. / Courtesy of LG Energy Solution

Currently, electric vehicle battery companies are receiving a tax credit benefit of $35 per kilowatt-hour for cells sold in the U.S. under the Inflation Reduction Act (IRA) 45X provision, and $10 per kilowatt-hour for modules (packs). Under the IRA 30D provision, consumers purchasing electric vehicles receive a tax credit benefit of up to $7,500.

The company predicted, "The possibility of abolishing the 30D provision among IRA policies seems high, while the 45X does not appear to have a high likelihood of change."

Regarding tariffs, it stated, "It seems that targeted pressure will be needed for specific countries rather than a universal tariff," and added, "In the short term, this may impact the market, but I believe that future direction will not change. We will increase production capacity (CAPA) utilization through an immediate and proactive response system."

LG Energy Solution recorded sales of 6.4512 trillion won and an operating loss of 225.5 billion won for the fourth quarter of last year. Compared to the fourth quarter of 2023, sales decreased by 19.4%, and the company shifted to a deficit. It marked the first quarterly loss since the third quarter of 2021 after over three years.

The operating profit for the fourth quarter of last year included 377.3 billion won in advanced manufacturing production tax credits (AMPC) under the U.S. Inflation Reduction Act (IRA). Excluding this, the operating loss for the fourth quarter of 2024 was 602.8 billion won, with an operating margin of -9.3%.

For the entirety of 2024, sales are projected to be 25.6196 trillion won, with an operating profit of 57.54 billion won. Compared to the previous year, sales decreased by 24.1%, and operating profit fell by 73.4%.