By Joyce Lee and Hyunjoo Jin
SEOUL (Reuters) – South Korean battery firm LG Energy Solution (LGES) said it expected electric vehicle demand growth to slow in the near-term, as it posted on Friday a quarterly loss for the first time in three years.
LG Energy Solution said it plans to cut capital expenditure by up to 30% this year, also warning of slowing growth because of changing environmental policies in some major markets.
The company, which makes batteries for Tesla (NASDAQ:TSLA), General Motors (NYSE:GM) and Hyundai Motor (OTC:HYMTF), reported an operating loss of 226 billion won ($158 million) for the October-December period.
The result compares with a profit of 338 billion won for the same period a year earlier.
In a New Year message early this month, LG Energy Solution CEO Kim Dong-myung said he expected the EV market would recover after 2026, while also warning of challenges such as the global expansion of Chinese rivals.
U.S. President Donald Trump also said this week that his administration would consider ending EV tax credits.
LG Energy Solution said on Friday that scrapping the U.S. federal tax credits of $7,500 on EV purchases would put downward pressure on EV demand.
Trump’s EV policies are expected to slow the pace of electrification in the U.S. in the short term, LG Energy Solution CFO Lee Chang-sil said during a conference call.
Revenue for the past quarter fell 19% from a year earlier to 6.45 trillion won.
Shares of LGES were trading up 0.14% after the results, versus a 0.6% rise in the benchmark KOSPI.
($1 = 1,430.2000 won)
