] South Korean conglomerate LG’s second-in-command Vice Chairman Koo Bon-joon on Dec. 12 said the group will put its top priority on electric vehicle and energy businesses in the next 30 years, with an enhanced focus on business-to-business markets.
Koo, the third son of honorary Chairman Koo Cha-kyoung, is currently at the forefront of leading LG’s new businesses that will drive future growth, although his older brother Chairman Koo Bon-moo is at the helm of the group. The younger brother presided over the group’s second-half achievements reporting conference instead of the chairman. He is also communicating with the Moon Jae-in government on behalf of the group.
“We are always putting energy, including electric vehicles, first (among new growth businesses),” Koo told The Korea Herald after a luncheon with Finance Minister Kim Dong-yeon on Dec. 12.
LG affiliates have been aggressively expanding investments in projects related to electric vehicle components, even raising speculations that LG may jump into production of complete electric cars.
In August, LG Electronics announced the construction of a factory for battery packs for electric vehicles in the US. LG Chem is currently producing electric vehicle batteries, while LG Display is providing automotive displays for carmakers.
It was the vice chairman who created the vehicle component division with his eye on the growing market when he headed LG Electronics in 2013.
Up until the third quarter of this year, the vehicle components division had grown to about 2.6 trillion won ($2.38 billion) in business, but incurred around 60 billion won in losses, but the group hopes to go into the black around 2019. It has global partners like Mercedes-Benz, Volkswagen and GM, and is in talks with new partners such as Jaguar Land Rover.
LG is also attempting to acquire Austria-based automotive light maker ZKW for an estimated $1.2 billion. The bid was submitted in August and is still open.
Koo, however, declined to comment on the deal.
“In the next 30 years, we will be engaged in energy businesses that will look at resources such as water and air with long-term perspectives,” he added.
Under Koo‘s leadership, LG has jumped into the energy storage system market in partnership with the world’s biggest ESS provider AES. LG Chem is to provide batteries for AES’ ESS systems worldwide by 2020.
The LG vice chairman’s comments are also interpreted as the group’s reinforced focus on business-to-business areas, a shift from business-to-consumer such as the struggling smartphone business.
In an organizational shake-up announced last month, LG launched the biggest-ever B2B Company within the electronics unit, which will oversee the business solutions, vehicle components, information display and energy businesses.
By Song Su-hyun/The Korea Herald (email@example.com