When LG announced it would no longer produce smartphones, that was quite a shock. Now The Korea Times gives us news that made things fit together: LG’s joint venture with Magna – called LG Magna e-Powertrain – would be close to signing a deal with Apple to manufacture the company’s first electric car.
The electric car would not have to have huge volumes at first because Apple would like to evaluate its “marketability.” That suggests it will be a halo product, which allows for higher profit margins and lower sales. Apple and LG would tease a prototype for that car in early 2024.
LG Magna e-Powertrain was announced on December 22, 2020. Its main goal was to “manufacture e-motors, inverters and onboard chargers and, for certain automakers, related e-drive systems to support the growing global shift toward vehicle electrification.”
The Korea Times points that LG is strategically adequate for Apple’s new electric car. Both companies already have ties since “LG Display, LG Chem, LG Energy Solution, and LG Innotek” are already Apple's suppliers. That would ensure the future electric car will have a steady delivery of components.
On the other hand, Magna is the largest automotive supplier in the world, one that also supplies manufacturing services to multiple carmakers. If Apple really is to make a car, it would better hire a company that can handle that. Remember that Apple does not even make its most famous products: Hon Hai (Foxconn) does it for the American company. Not by chance, the Taiwanese company also has plans to manufacture EVs.
The deal with Apple would also be crucial for LG to prove it can be a good supplier for automotive companies not only for batteries but also for the other components LG Magna e-Powertrain wants to source. If its smartphone business were going slow, an Apple EV would probably give LG the hotcake it always wanted to sell – only on wheels.