Weak EV Demand in Europe and U.S. Drags Korean Battery Giants into Collective Losses

Impacted by adjustments to U.S. electric vehicle (EV) subsidy policies and weakening demand in European and American markets, South Korea’s three major battery makers—LG Energy Solution, Samsung SDI, and SK On—all reported operating losses in the fourth quarter of 2023. LG Energy Solution posted a quarterly loss of KRW 122 billion (approximately RMB 5.75 billion); excluding U.S. tax credits, its loss widened to KRW 454.8 billion. During the same period, Samsung SDI and SK On projected losses of approximately KRW 300.3 billion and KRW 200 billion, respectively. In December 2023 alone, LG Energy Solution suffered major setbacks: Ford canceled a KRW 9.6 trillion order, and Germany’s FBPS terminated a KRW 3.9 trillion partnership. Within just ten days, the company lost orders totaling KRW 13.5 trillion, causing capacity utilization at its Polish plant to plummet to 30%. Analysts note that policy uncertainty in the U.S. and Europe, declining EV sales, and intensified competition from Chinese battery giants like CATL and BYD—who are rapidly expanding their global market share—are further squeezing the operational space for South Korean battery manufacturers.