·Chinese factory will become the main source of electric vehicle accessories

According to the Nikkei News website, a new electric vehicle parts production line of the technology giant LG Electronics Group has been completed and put into production. The production line mainly supplies parts to GM. Recently, the production line will be officially put into operation, and the commissioning of the new production line will make the Korean auto parts production unit, which has just started, become profitable.
According to reports, LG's new production line is located in Incheon, a Korean port city, and will become the business center of the company's automotive electronics products in the future. Since the beginning of this year, LG has invested 400 billion won (about 356 million US dollars) in the construction of this production line. Its construction projects include new production lines and its supporting R&D centers. In recent years, LG has invested nearly 30-40 billion won in projects each year.
Currently, LG offers more than 10 key components to the Chevrolet Bolt model produced by GM. Chevrolet Bolt is an electric car that GM plans to launch at the end of this year. Parts supplied by LG include battery packs, inverters, and components used in powertrain systems. Liquid crystal display panels and data display system products are also available.
Typically, automakers typically build parts and components on a wide range of supply channels to spread the risks posed by a single supplier. However, GM has largely chosen LG as a key supplier to supply parts for its new electric vehicle manufacturing. GM's upcoming Chevrolet Bolt electric car can reach an unprecedented cruising range (matching, picture, inquiry), and its cost price may be less than $40,000 - GM described the project as a disruptive innovation. GM and LG jointly developed components for this electric vehicle and shared their expertise in engine design, battery control and other automotive manufacturing technologies with LG.
For LG, this cooperation with GM is largely the first time that it has bundled multiple parts and components with its customers. Currently, LG has manufacturing facilities in China, Vietnam and Pyeongtaek, Korea, and Incheon is a key supply center.
In the second quarter of April-June this year, LG's revenue in the auto parts business was close to 640 billion won, up 40% year-on-year. Despite the growth of its automotive business segment, LG lost nearly 17 billion won in the auto parts business.
Integrating Group Businesses LG Group's business related to the automotive industry has historically been a decentralized operation. For example, LG Chem used to provide automotive battery products to GM. In 2013, LG Group established a dedicated auto parts division. The department conducts business under the direct management of the group headquarters, and is mainly engaged in research and development and sales of products such as car navigation systems, car monitors and camera modules.
At the same time, LG's production base in Incheon, its first phase of the project covers an area of ​​about 100,000 square meters, and plans to send 800 researchers and other staff to the new base. At present, with the joint efforts of all parties involved, the prototype of the project has been basically completed, and the environmental durability test has been carried out.
Among all the auto parts produced by LG, the battery products will be the most promising in the future. Because for all electric vehicles, the battery is the core component that determines its overall performance and final cost price. LG has manufacturing facilities for producing lithium batteries in the United States and South Korea; in addition, another lithium battery factory was built in Nanjing, China last year. The manufacturing plant in Nanjing, China will gradually provide lithium battery products to various auto manufacturers in China. Although LG's capital expenditures are close to the red line, its orders are increasing.
LG's factory in Nanjing has not yet received administrative approval from the Chinese government. The Chinese government seems to be coming soon to introduce new regulations that may require only manufacturers that produce batteries for pure electric and plug-in hybrids to qualify for subsidies. Many companies have been striving for government support, but most of them are domestic companies from China. LG plans to increase its lobbying for the Chinese government to maintain its competitiveness in China.

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