LG Energy Solution nears $7.2 bil. BMW battery deal

LG Energy Solution’s 46-series cylindrical batteries / Courtesy of LG Energy Solution

LG Energy Solution is likely to supply BMW with its 46-series cylindrical batteries, a deal that would mark a potential first-time partnership to power the German carmaker’s pure electric vehicles (EVs).

According to the battery industry on Thursday, the two sides are in the final stages of negotiating a contract estimated to be worth around 10 trillion won ($7.2 billion), with a supply period expected to span about 10 years.

If finalized, the agreement would expand LG Energy Solution’s client base for the 46-millimeter-diameter cylindrical battery format, a technology widely seen as key for next-generation EVs.

The company has already secured supply agreements for the 46-series batteries with several global EV manufacturers, including Tesla, Mercedes-Benz, Rivian, Chery Automobile and Aptera.

However, an LG Energy Solution official declined to confirm the reported BMW contract, saying, “We cannot comment on matters related to specific customers.”

The potential deal comes as the company seeks to rebound from a weak first quarter by accelerating growth in both EV and energy storage system (ESS) businesses.

In a regulatory filing Thursday, LG Energy Solution reported an operating loss of 207.8 billion won ($145 million) for the January–March period, swinging from an operating profit of 374.7 billion won a year earlier and marking a second consecutive quarterly loss. Revenue fell 2.5 percent year-on-year to 6.55 trillion won, while the company posted a net loss of 944 billion won.

A major factor behind the earnings decline was a sharp drop in advanced manufacturing production credits under the U.S. Inflation Reduction Act. The subsidy totaled 189.8 billion won in the first quarter, just 41.5 percent of the 457.7 billion won recorded a year earlier.

Despite the weak results, the company said it has secured more than 440 gigawatt-hours of order backlog for its 46-series cylindrical batteries, adding over 100 gigawatt-hours in new orders since the end of last year.

LG Energy Solution expects the Middle East conflict to underscore the role of ESS as a complement to traditional power generation while accelerating the global transition to EVs.

The company plans to boost new ESS orders tied to power infrastructure and artificial intelligence data centers while stabilizing its North American production bases. In the EV sector, it aims to capture demand opportunities with a diversified product portfolio and flexible production capabilities, while preparing to launch its Arizona plant later this year.

“Based on a meticulous strategy and disciplined execution, we will accelerate growth and take the lead in future markets,” CEO Kim Dong-myung said.