Skip to content
  • KOSPI 2358.41 +11.67 +0.50%
  • KOSDAQ 824.65 +2.40 +0.29%
  • KRX100 5028.00 +30.43 +0.61%
  • USD/KRW 1142.2 -3.40 -0.30%
  • JPY100/KRW 1,083.01 -3.69 -0.34%
  • EUR/KRW 1,344.2 2.30 0.17%
  • CNH/KRW 170.65 0.04 0.02%
Visit Market Data

Tesla CEO's tweets allay concerns over EV battery supplies; LG Chem shares rise

Sep 22, 2020 (Gmt+09:00)

Shares of LG Chem Ltd. rebounded on Sept. 22 from their shaky performance in the past few sessions, buoyed by Tesla Inc. founder Elon Musk’s comments that the company plans to increase battery purchases from its current suppliers, including LG.

In a tweet on Tuesday, the Tesla chief executive said, “We intend to increase, not reduce, battery cell purchases from Panasonic, LG & CATL (possibly other partners too). However, even with our cell suppliers going at maximum speed, we still foresee significant shortages in 2022 & beyond unless we also take action ourselves.”

Analysts said Musk’s comments reinforced the market view that LG Chem will remain a key supplier of rechargeable batteries to Tesla even after the US electric-vehicle maker starts making battery cells on its own.

LG Chem's EV batteries

The remarks pushed LG Chem shares as much as 3% higher on Tuesday before closing up 1.9% at 639,000 won, outperforming the broader Kospi market, which finished down 2.4%. Previously, LG Chem had fallen nearly 14% in just four days as retail investors, disappointed by its announcement to spin off its lucrative battery business as a separate entity, dumped the stock.


Musk’s comments came a day before the much-anticipated Tesla Battery Day event, when the top American EV brand is expected to unveil its own battery technology and major plans, which could impact its EV production and the procurement of battery cells from suppliers.

Tesla CEO Elon Musk
Tesla CEO Elon Musk

Tesla currently procures EV batteries from other companies, but speculations run wild that it is preparing to internally produce batteries and this announcement would come on its Battery Day.

LG Chem was selected as one of the battery suppliers for the Tesla Model 3 in 2019.

In another tweet on Tuesday, Musk said the Battery Day would “affect long-term production, especially Semi, Cybertruck & Roadster, but what we announce will not reach serious high-volume production until 2020.”

Koh Tae-bong, head of research at Korea’s HI Investment & Securities, said Musk’s comments somewhat ease battery suppliers’ concerns.

“Even if Tesla makes its own batteries, it will face a shortage as it plans to increase the sale of low-priced EVs in the European market,” Koh said. “Musk’s comments reaffirm that LG and other local battery makers’ businesses won’t be hurt significantly by Tesla’s move to produce EV batteries on its own.”

By Yun-Sang Ko

In-Soo Nam edited this article

Comment 0


0/5 articles left. Sign in for unlimited access to all articles.