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EV battery makers set to report robust Q4 results on strong demand
Date
2021.01.04
Views
119


According to Yonhap News,


SEOUL, Jan. 3 (Yonhap) -- South Korea's three electric vehicle (EV) battery makers are expected to report robust or improved fourth-quarter earnings results on growing demand for electrified vehicles, analysts said Sunday.

LG Energy Solutions Ltd., SK Innovation Co. and Samsung SDI Co. likely performed well in the October-December period as carmakers are adding more battery-powered models to their lineups due to emissions restrictions, they said.

The three companies plan to release their business results for the fourth quarter and the year of 2020 at the end of January.

Samsung SDI is expected to have made a stellar performance in the fourth quarter. Its operating profit likely soared to slightly over 300 billion won (US$275 million) from 20 billion won a year earlier, according to brokerages' median forecast.

LG Energy Solutions looks set to post an operating profit of 270 billion won in the fourth quarter. LG Energy is a battery-focused business company spun off from LG Chem Ltd., the country's biggest chemical company.

LG Chem announced the spin-off plan in September as carmakers are racing to go electric and eco-friendly due to tightened regulations on greenhouse gas emissions, which scientists say are to blame for global warming.

Analysts expect SK Innovation, the smallest player, not to have turned around in the fourth quarter, but it will likely report a narrowed quarterly operating loss helped by battery demand.

SK Innovation's operating losses are expected to narrow to 123 billion won in the fourth quarter from 479.99 billion won a year ago.

The three Korean companies accounted for 34 percent of the world's car battery markets from January to November last year, with their combined market share jumping from 17 percent during the same period of 2019, according to market tracker SNE Research.

The companies are likely to report better earnings results this year on higher demand for electric cars and stricter emissions regulations.

But they face uncertainties due to the ongoing trade secret dispute involving LG Energy and SK Innovation and U.S. electric carmaker Tesla Motors Inc.'s plan to develop a highly effective battery for its models.

Last month, the U.S. International Trade Commission (ITC) again postponed the final ruling slated for Dec. 10 on the dispute to Feb. 10.

LG Energy, which supplies batteries to Tesla Motors Inc. and General Motors Co., filed trade complaints with the ITC in early 2019, claiming SK Innovation stole its trade secrets of EV battery technology by hiring its former employees.


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kyongae.choi@yna.co.kr

Source: Yonhap News (Jan 3, 2021)


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