[Edaily Reporter JAEMIN SONG ] LG Energy Solution’s average battery plant utilization rate has surpassed 57%. The utilization rate, which had fallen below 50% last year due to the electric vehicle “chasm” (a temporary lull in demand), appears to be improving thanks to the expansion of the energy storage system (ESS) business and a recovery in electric vehicle battery production.

According to the third-quarter report released by LG Energy Solution on the 13th, the average capacity utilization rate at its domestic and overseas battery plants from January through September of this year stood at 57.1%. This is 9.5 percentage points higher than last year’s annual capacity utilization rate of 47.6%. It also represents a 4.3 percentage point increase compared to the cumulative capacity utilization rate of 52.8% for the first half of this year.

LG Energy Solution’s annual capacity utilization rate fell from 57.8% in 2024 to 47.6% last year. As automakers reduced battery orders due to slowing demand for electric vehicles, this impacted the operation of production facilities. However, the company has been showing signs of recovery this year as production of batteries for energy storage systems (ESS) has expanded and demand for cylindrical batteries for electric vehicles has increased.

In North America, in particular, the company converted existing EV battery production lines for ESS use and brought new production lines online. The joint venture plant with General Motors (GM) in the U.S. also resumed operations in August. In Europe, improved utilization rates at the Polish plant contributed to the recovery in performance. During its earnings announcement on the 3rd, LG Energy Solution explained that expanded ESS shipments and increased supply of cylindrical batteries drove the improvement in the company-wide utilization rate.

Cumulative production capacity for the first three quarters of this year totaled 40.0053 trillion won, while actual production amounted to 22.843 trillion won. From January through September of this year, the company invested a total of 3.7564 trillion won in new and expanded production facilities and quality enhancement. Going forward, the company plans to focus on maximizing the utilization of existing production facilities rather than investing in new equipment.

Investment in research and development (R&D) also continued. Cumulative R&D expenses for the first three quarters of this year totaled 1.1261 trillion won, accounting for 4.7% of revenue. LG Energy Solution is pursuing the development of next-generation sodium-ion batteries and lithium iron phosphate (LFP)-based cylindrical batteries, among others. Next year, the company aims to ship test products for sodium-ion batteries to North American customers and begin mass production of LFP-based tabless 2170 cylindrical batteries.