What is LG Energy Solution's strategic shift regarding defense contracts, and how does it contrast with its historical stance?

LG Energy Solution is in early-stage talks with the US government and major defense contractors to supply batteries for drones and other unmanned weapons systems, marking a significant strategic shift as the company has historically avoided the defense sector. As stated by Bob Lee, the company’s North America president, LG previously viewed defense work similarly to how consumer companies avoid alcohol or tobacco—considering it outside its scope—but now sees clear growth and opportunity amid slowing electric vehicle demand and US efforts to strengthen domestic defense supply chains.

How is LG Energy Solution adapting its US manufacturing footprint in response to changing market demands, and what are the key projects underway?

LG Energy Solution is repurposing five of its eight US plants—originally built for EV batteries—toward energy storage production, reflecting a broader reorientation after expected EV adoption failed to materialize; energy storage now constitutes the majority of its US business. Key projects include the newly opened Lansing, Michigan plant (a joint venture with GM), which will supply $4.3 billion worth of lithium-iron-phosphate cells for Tesla’s Megapack systems starting in 2027, produce nickel-based cells for Toyota vehicles, and achieve 35 GWh annual capacity by end of next year—while the Holland, Michigan plant shifts to making energy storage cells for DTE Energy.

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