LG Electronics and Magna International officially announced the transaction agreement, which establishes the LG Magna e-Powertrain joint venture (49% Magna, 51% LG). The deal was a bit delayed as the two partners were negotiating strategy and equity price.
The new company is headquartered in Incheon, South Korea and will employ more than 1,000 employees in the United States, South Korea and China.
The main objective is to combine the strengths of both partners and jointly manufacture electric motors, inverters, on-board chargers and other "e-drive systems."
"The creation of the joint venture unifies Magna’s strength in electric powertrain systems and world-class automotive manufacturing, with LG’s expertise in component development for e-motors and inverters. Announcing LG Magna e-Powertrain’s executive team marks a key milestone for the joint venture company, which will manufacture e-motors, inverters and on-board chargers and, for certain automakers, related e-drive systems."
Both LG and Magna were already supplying EV-related components to multiple electric car manufacturers and, as the market expands, LG Magna e-Powertrain sales are expected to grow as well.
LG Magna e-Powertrain CEO Cheong Won-suk said:
“Partnering with Magna enables LG to scale-up its global production, provide additional business opportunities and offer synergies in procurement and technological innovation. The integrated and collaborative approach is expected to deliver quickly for customers and capitalize on the rapid growth of the worldwide electric powertrain market.”
LG Magna e-Powertrain COO Javier Perez said:
“The market for e-motors, inverters and electric drive systems is expected to have significant growth between now and 2030. Our joint venture company brings together experts from Magna and LG to deliver a world-class portfolio of electric solutions. Leveraging existing technologies, engineering capabilities and global footprints, LG Magna e-Powertrain seeks to enable advancements that help automakers achieve some of the biggest challenges ahead in electrifying their full vehicle lineups."