Samsung, LG Electronics Accelerate Push into Fast-growing EV Market | Be Korea-savvy

Samsung, LG Electronics Accelerate Push into Fast-growing EV Market

A Samsung employee demonstrates Harman's Ready Care, a driver monitoring system, during CES 2023, in Las Vegas, on Jan. 5, 2023. (Yonhap)

A Samsung employee demonstrates Harman’s Ready Care, a driver monitoring system, during CES 2023, in Las Vegas, on Jan. 5, 2023. (Yonhap)

SEOUL, Aug. 11 (Korea Bizwire)Samsung Electronics Co. and LG Electronics Inc. said Friday they will attend IAA Mobility 2023, an annual global mobility show to be held in Germany, for the first time, in a step seen as an attempt to gain a bigger share in the fast-growing electric vehicle (EV) parts market.

IAA Mobility, one of the world’s largest mobility trade fairs, is set to take place in Munich from Sept. 5-8, where industry experts and businesses discuss and share the latest automobile trends and the future of mobility.

Samsung Electronics’ Device Solutions division in charge of semiconductors, Samsung Display and Samsung SDI, Samsung Group’s display panel-making and battery-making affiliates, respectively, will attend the show.

Samsung, the world’s largest memory chip maker, is a relative latecomer in the EV market.

It has, however, ramped up efforts in recent years to develop advanced chips for cars, a market that has grown significantly, fueled by higher levels of car electrification with advanced features, like artificial intelligence and 5G-based telecommunications, and a further uptake in electric vehicles.

Harman, Samsung’s automotive and audio electronics subsidiary, has reported steady growth since it was acquired by Samsung for US$8 billion in 2016.

In the three months ending in June, Harman logged 3.5 trillion won (US$2.65 billion) in sales and 250 billion won in operating profit, bagging the largest automotive order in its history.

The figures were up 17.4 percent and 150 percent from the year-ago period, respectively.

In 2022, the company’s sales and profit hit record highs, driven by rising demand for its high-end infotainment system.

Samsung also aims to expand its footprint in the automobile chip market, a highly promising segment the company sees as potentially becoming one of the three biggest chip applications, along with servers and mobile.

London-based research firm IHS Markit projected the global automotive semiconductor market would log an average annual growth rate of 11 percent to reach $143 billion by 2029.

The concept photo, provided by LG Electronics Inc., shows LG Magna's e-Powertrain.

The concept photo, provided by LG Electronics Inc., shows LG Magna’s e-Powertrain.

At the IAA event next month, LG said it will share its vision for future mobility at its first-ever press conference, titled “Taking Life’s Good on the Road,” on Sept. 4.

The company said it will “provide its vision of the in-vehicle experiences of the future and illustrate the highly advanced mobility ecosystem the company proposes to its partners and customers.”

LG’s EV component division, consisting of in-vehicle infotainment systems, e-powertrain and headlamps, has grown at an annual pace of 30 percent since it began operations more than 10 years ago.

For the second quarter, the division reported quarterly sales of 2.66 trillion won, the highest second-quarter revenue in company history.

LG expected the EV unit’s accumulative order backlog “to reach 100 trillion won by the end of the year” amid the explosive growth of electric vehicles.

“Cars have evolved from a transportation means to a space that serves various purposes and provides new experiences,” LG CEO Cho Joo-wan said at a press conference last month.

“The Vehicle Solutions division aims to become one of the world’s top players in the future mobility sector and to achieve annual sales of more than 20 trillion won by 2030 by actively responding to new mobility trends and using our insights into business-to-consumer markets,” he said.

LG Magna e-Powertrain, a joint venture between LG Electronics and Magna International Inc., will operate a new factory in Mexico next month to produce inverters, motors and on-board chargers for General Motors.

Kim Dong-won, an analyst at KB Securities, forecast LG’s EV business to contribute up to 12.3 percent of the company’s operating profit next year, up from 4.6 percent in 2022.


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