LG Energy Solution Signs Large-Scale Battery Contract with Mercedes-Benz, Estimated at 15 Trillion Won

[Financial News] LG Energy Solution announced on the 3rd that it has signed a large-scale electric vehicle battery supply contract with Mercedes-Benz. The total contract volume exceeds 100GWh (gigawatt hours), and the contract size is estimated to be about 15 trillion won.
In particular, this large-scale supply contract was achieved after fierce competition with Chinese companies that emphasized price competitiveness, and LG Energy Solution's 46 series is evaluated to have overcome this with its technology.

LG Energy Solution announced in the disclosure that it has signed two contracts to supply a total of 75GWh of electric vehicle batteries in the U.S. region from July 2029 to December 2037, and a total of 32GWh in the European region from August 2028 to December 2035.
LG Energy Solution stated, "We cannot confirm any additional details beyond the disclosed content in consultation with the client."
However, the battery industry expects that the two contract supply products are the next-generation cylindrical batteries, the 46 series. If so, this is the largest among the 46 series supply contracts announced so far.
This is enough to produce approximately 1.5 million electric vehicles, and the contract size alone is estimated to be about 15 trillion won.
The battery industry sees that LG Energy Solution has solidified its position as a key supplier for Mercedes-Benz by signing a large supply contract based on the 46 series this year, following last year.
In fact, LG Energy Solution signed a contract with Mercedes-Benz in October last year to supply a total of 50.5GWh of electric vehicle batteries in North America and other regions. It is also estimated that the contract was made with the 46 series at that time, meaning LG Energy Solution has signed contracts totaling over 150GWh with Mercedes-Benz using only the 46 series products.



This contract is highly significant as it was achieved after fierce competition with Chinese companies.
In the case of Mercedes, it has been expanding cooperation with Chinese battery companies such as CATL and Farasis, but LG Energy Solution is known to have overcome the fierce competition with Chinese companies, which emphasized price competitiveness, with its 46 series technology in this bidding.
This order is also analyzed to have once again recognized LG Energy Solution's differentiated 'local production capacity'.
LG Energy Solution is currently constructing a 36GWh cylindrical dedicated production plant in Arizona, USA, and will start mass production of the 46 series from next year.
The 75GWh volume of the contract disclosed on this day is expected to be supplied from the Arizona plant in the U.S. In the end, it is analyzed that the 'local production capacity' preemptively established in the U.S. amid increasing uncertainties due to changes in major countries' policies, such as tariffs, determined the outcome of this bidding competition.
Moreover, it is expected to be an opportunity to reclaim the European market with technology. The battery industry expects this order to be a turning point in regaining the market share that was being dominated by Chinese companies with low prices in the European market. The industry expects additional orders in the European market to follow this order. It is also expected that the Wroclaw plant in Poland could be used for 46 series production in the future.
An industry official said, "LG Energy Solution has succeeded in a large-scale order to Mercedes, defeating Chinese companies, proving once again the advanced technology of the Korean battery industry," adding, "Based on the definite competitive edge in the 46 series, it is expected to further expand its influence in the global market."


hjkim01@fnnews.com Hakjae Kim, Reporter