This file photo provided by LG Energy Solution Ltd. shows its ESS products equipped with lithium iron phosphate batteries. (Image courtesy of Yonhap)
SEOUL, July 30 (Korea Bizwire) — LG Energy Solution Ltd., South Korea’s largest battery manufacturer, said Wednesday it has signed a 5.9 trillion won ($4.26 billion) contract to supply lithium iron phosphate (LFP) batteries to an undisclosed overseas client.
In a regulatory filing, LG Energy said the agreement spans three years, from Aug. 1, 2027, to July 31, 2030. The contract’s value represents roughly 23% of the company’s 2023 annual revenue of 25.6 trillion won.
The terms of the deal—including value and duration—remain subject to change pending further negotiations with the client, the company said.
Industry analysts speculate the client may be Tesla Inc., which has signaled interest in sourcing LFP batteries from outside China due to U.S. import tariffs. During its first-quarter earnings call, the U.S. electric vehicle maker said it was seeking new suppliers to diversify its battery sourcing strategy.
LG Energy Solution operates battery cell plants in Michigan, Ohio and Tennessee. Its Michigan facility already produces LFP batteries for use in energy storage systems (ESS), a segment of growing importance amid the global shift toward renewable energy.
LFP batteries offer enhanced thermal stability and lower production costs compared with lithium-ion and nickel cobalt manganese (NCM) alternatives. However, they generally deliver lower energy density and shorter driving range, making them more common in entry-level EVs and stationary storage applications.
Ashley Song (ashley@koreabizwire.com)
