|LG Chem’s factory in Yeosu. (LG Chem)|
LG Chem is expanding in petrochemicals and electric car battery technology.
Since merging with LG Daesan Petrochemicals and LG Petrochemicals in 2006 and 2007, respectively, it has vertically integrated its production system at the company.
Dividing its business project scope into two different areas ― petrochemicals, and information and electronics materials that include batteries ― the firm has seen increases in sales and total market value since 2009.
Total sales jumped 49 percent from 15.52 trillion won ($14.43 billion) in 2009 to 22.67 trillion won in 2011, and market value also rose from 5.65 trillion won in 2009 to 25.87 trillion won, according to company officials.
A major event that highlights LG Chem’s success is an ongoing project with Kazakhstan firms.
LG Chem and two Kazakhstan firms signed an agreement in 2011 to build a petrochemical complex in Atyrau. Injecting an investment of $4.2 billion into the complex, LG plans to build an ethylene production plant there that manufactures up to 800,000 tons a year, according to its officials.
This is the biggest project since Kazakhstan announced its independence in 1991.
With the petrochemical complex being one of the few foreign firm projects fully supported by the Kazakhstan government, LG chairman Koo Bon-moo has discussed cooperative measures with President Nursultan Nazarbayev since first visiting Kazakhstan as a Korean business representative in 2004.
With the new plant expected to increase competitiveness that would compete against the low-priced Middle Eastern petrochemical products, LG and its partners plan on producing the goods beginning in 2016.
Another major international event for LG Chem was in July 2010 when U.S. President Barack Obama participated in the ground-breaking ceremony of its electric vehicle battery plant in Holland, Michigan.
Endowed with a $150 million federal grant, the company announced its plans to put $300 million by 2013 into constructing a factory on about 500,000 square meters of land in the city.
However, the factory has deferred the date for full operation mode due to the unfavorable market conditions.
LG Chem also built a battery plant in Ochang, North Chungcheong Province, in April 2011, which is a facility that can produce up to 200,000 units annually of batteries for electric cars.
The company has secured more than 10 major carmakers, including GM, Ford, Renault and Hyundai-Kia, as its customers up until now.
On another front, the company was also the first in the world to develop the 3-D film-type patterned retarder in 2010. The market was not so positive about the technology at the time, with the adoption of the shuttered glass method technology emerging as the preference.
The solid sales figure, however, showed that such perceptions were misguided as the operating profit figure reached 354 billion won in the first three quarters last year, its officials said.
By Cho Ji-hyun (email@example.com)