LG Energy Suffers Surprise 4Q25 Loss Amid EV Market Slowdown

LG Energy posted an unexpected operating loss of US$83.8 million in 4Q25, as slowing electric vehicle demand in key markets weighed on earnings. The result contrasted with analyst forecasts for a US$22.7 million but represented a narrower loss than the US$155 million recorded a year earlier. Without US advanced manufacturing tax credits, the quarterly loss would have deepened to US$312 million. Revenue declined 4.8% year on year to US$4.2 billion, with full financial details scheduled for release later this month.

The South Korean battery manufacturer pointed to a slowdown in the US electric vehicle market as the primary driver. Analysts at Shinhan Investment Corp. attributed the earnings miss to the expiration of EV subsidies, inventory normalization among North American automakers, and reduced policy support for advanced manufacturing.

Shifting US policy has rippled across the EV supply chain. General Motors has flagged an additional US$6 billion in charges linked to EV production cuts, while Ford reported US$19.5 billion in charges  tied to the restructuring of its electric vehicle operations. Ford also terminated a US$6.5 billion battery supply deal with LG and withdrew from a US joint venture with SK On.

In response, LG Energy is recalibrating its strategy. The company is divesting assets from its Ohio joint venture with Honda to streamline operations and is expanding its energy storage systems (ESS) business, with new production lines planned in Arizona and Michigan. Chief Executive Kim Dong-myung said the group will increase the use of artificial intelligence across product development, materials engineering, and manufacturing, targeting productivity gains of at least 30% by 2030.