LG Magna to build plant in Hungary for European EV market

MUNICH -- LG Magna e-Powertrain Co., a joint venture between South Korea’s LG Electronics Inc. and Canada’s Magna International Inc., has announced plans to build an electric vehicle parts factory in Hungary, in line with the home appliance giant's push to lead the world’s future mobility sector.

LG Magna, an EV powertrain maker, is set to start operations in 2026 producing driving motors at the facility in Miskolc with plans to manufacture other components depending on demand in the world’s second-largest clean vehicle market, LG Electronics said on Monday without providing financial details on the investment.

“Along with the facilities in Mexico, China and South Korea, the facility in Hungary will be critical as the company accelerates its position as a go-to mobility solutions partner in the fast-growing global EV market,” said LG Magna chief executive Cheong Won-suk in a statement.

The company said it chose Hungary for the site of the new factory given its accessibility to European automakers and Magna’s existing facilities. Miskolc has great logistics and transportation infrastructure for the development of the automobile and machinery industries.

LG Electronics launched the JV in July 2021 with Magna to ramp up its future mobility business by combining the Canadian auto parts maker’s expertise in electric powertrain systems and the South Korean tech behemoth’s capabilities in component development for e-motors, inverters and on-board chargers. LG Electronics has a 51% stake in the JV, while Magna holds the rest.

AIMS TO LEAD THE GLOBAL FUTURE MOBILITY SECTOR

The new factory in Hungary is a move to accelerate LG Electronics’ efforts to transform from a home appliance giant into a global future mobility sector leader. 

Toward this end, the company aims to utilize its expertise and know-how from the home appliances and information technology businesses, its CEO Cho Joo-wan said.

“We strongly believe future mobility should focus on the mission to deliver another level of customer experience. LG, with innovative mobility solutions, is more than committed to this mission,” the CEO, also known by his English name William Cho, told a press conference at IAA Mobility in Munich.

“As we are endeavoring to unlock the future of mobility, we invite all industry leaders to join us in this exciting and important journey,” Cho said, keeping the door open for acquisitions in the automotive electronics sectors.

LG Electronics has developed three customer experience themes for automobiles – transformable, explorable and relaxable – to realize its future mobility vision as it is redefining the car as a “personalized digital cave,” Cho said.

LG Electronics can support this shift with its displays, home appliances and digital health technologies, he added.

The company has been expanding its automotive electronics businesses. Its vehicle component solutions division handles the in-vehicle infotainment sector, while ZKW Group, an Austria-based firm acquired in 2018, and LG Magna work on the car lighting and EV powertrain businesses, respectively.

LG Electronics led the global vehicle telematics market last year with a 23.3% share and has maintained a double-digit share in the audio, video and navigation segment since 2021, according to market research firm Strategic Analytics.

Write to Ik-Hwan Kim at lovepen@hankyung.com
 

Jongwoo Cheon edited this article.