LG Energy to supply $748 million worth of batteries to Japan’s Isuzu Motors

LG Energy Solution Ltd., one of the world’s leading battery makers, has agreed to supply its cylindrical batteries to Isuzu Motors Ltd., Japan’s top commercial vehicle and diesel engine maker.

LG, South Korea’s top battery maker, said in a regulatory filing on Friday that it has clinched the deal with Isuzu to supply batteries until the end of 2026.

It did not reveal the size and value of the deal, but industry sources said the contract is worth at least 1 trillion won ($748 million).

Under the deal, LG has supplied some of its batteries to the Japanese truck maker since June last year, the Korean firm said in the public filing.

The public disclosure confirms a Korea Economic Daily report in July 2022 that the two companies were in a battery supply deal.

At the time, people familiar with the matter said the two companies agreed to push for Isuzu’s truck electrification project together.

LG Energy, an affiliate of South Korea’s LG Group, will supply cylindrical batteries to Isuzu for the Elf, the Japanese firm’s mid-size truck.

Isuzu began producing an electric version of the Elf in October.

In Korea, Isuzu has been selling diesel-powered Elf trucks since 2017. The Japanese company has so far sold more than 2,000 Elf trucks in Korea.

LG, which began mass-producing cylindrical batteries in 1999, has already been supplying its pouch-type batteries to Nissan Motor Co. for the Ariya EV.

JAPANESE FIRMS TURN TO KOREA FOR BATTERY SUPPLIES

While Japan’s Panasonic is supplying most of its batteries to Tesla Inc., Japanese carmakers are looking to other companies for batteries and LG is one of their favorite suppliers, according to industry officials.

Globally, LG Energy counts more than 10 carmakers, including General Motors, Ford Motor, Renault Group, Volkswagen, Audi, Jaguar, Tesla and Lucid Motors, among its battery clients.

In the US, LG runs its battery plant in Michigan and separately operates a joint venture, Ultium Cells LLC, with its partner GM.

Write to Hyung-Kyu Kim at khk@hankyung.com


In-Soo Nam edited this article.