LG Energy Solution said on the 13th that third-quarter operating profit rose 34.1% from a year earlier to 601.3 billion won. Revenue for the same period came to 5.6999 trillion won, down 17.1%.
Operating profit excluding subsidies under the Advanced Manufacturing Production Credit (AMPC) of the U.S. Inflation Reduction Act (IRA) was 235.8 billion won. LG Energy Solution has remained in the black for two consecutive quarters even after excluding subsidies.
With shipments of locally produced energy storage system (ESS) volumes increasing, subsidies appear to have decreased somewhat as major customers' demand fell due to the end of electric vehicle purchase subsidies in September.
Industry watchers said the impact of the second-half electric vehicle purchase subsidies will continue, limiting growth momentum for EV volumes. However, as ESS demand is showing a firmer trend than previously expected, this could be an opportunity for LG Energy Solution, which has local production capabilities.
In May, LG Energy Solution began full-scale mass production of lithium iron phosphate (LFP)-based ESS long cells at its Holland, Michigan, plant. The company plans to prioritize some production capacity (capex) including joint ventures (JV) for ESS-bound supply.