LG Energy Solution Sees 34% Profit Surge as U.S. EV Demand Peaks Before Tax Credit Expiry

LG Energy Solution (LGES), a leading South Korean battery manufacturer supplying major automakers like Tesla and General Motors, announced a sharp 34% rise in its third-quarter operating profit. The surge was driven by strong electric vehicle (EV) demand in the United States, where buyers rushed to take advantage of a $7,500 federal tax credit that expired on September 30.

According to preliminary estimates, LGES recorded an operating profit of 601 billion won ($420 million) between July and September, up from 448 billion won during the same period last year. The figure surpassed analyst expectations, which averaged 528 billion won, according to LSEG SmartEstimate data.

Analysts attributed the performance boost to a spike in U.S. EV sales before the incentive deadline. However, LGES has cautioned about a potential slowdown in EV demand early next year, citing the end of tax benefits and new U.S. import tariffs imposed under the Trump administration. Excluding U.S. manufacturing incentives granted under the Inflation Reduction Act, LGES’s profit would have been 236 billion won.

To diversify and sustain profitability, LGES has been ramping up production of batteries for energy storage systems (ESS). Recently, the company secured a $4.3 billion deal with Tesla to supply ESS batteries, aligning with the U.S. automaker’s strategy to reduce dependency on Chinese imports.

Despite these gains, LGES faced challenges in the U.S. after an immigration raid in September temporarily halted construction at its joint battery plant with Hyundai Motor in Georgia. The delay could push back operations by up to three months.

LGES plans to release its full financial report on October 30, as it continues efforts to balance growth in energy storage with moderating EV market demand.