LG companies appoint young leaders amid challenges
LG Magna e-Powertrain, a joint venture EV parts supplier owned by LG Electronics and Aurora, Canada's Magna International, is expected to name 54-year-old Cheong Won-suk as the first CEO.
Board members of the new company will hold a meeting on July 1 to vote on the appointment of Cheong. The board is expected to have five members: three from LG Electronics and two from Magna International.
Cheong previously worked at Daewoo Motors. He has had roles at LG Corp.’s synergy team and at LG CNS. He has been working at the vehicle component solutions (VS) division of LG Electronics since 2018.
The synergy team was tasked with coordinating with related company.
LG companies have been naming many young executives in recent years.
The average age of LG company executives who were appointed in the last three years was 48. A total of 13 people aged 45 or under were appointed as executives in 2017, but that grew to 21 in 2018 and 2019 and 24 in 2020.
In November 2019, LG Electronics appointed a 56-year-old Kwon Bong-suk as the new CEO replacing Jo Seong-jin. Jo was 65 at the time.
The automotive component business is a new area of focus, especially in terms of advanced components and robotics.
In 2018, LG Electronics acquired ZKW, an Austrian automobile lighting supplier, for 1.44 trillion won ($1.3 billion).
Late last year, LG Electronics announced the establishment of LG Magna e-Powertrain with Magna International, a major bet on the automotive parts business for EVs. The company will produce key components for EV powertrain systems such as motors, inverters and onboard chargers, according to LG Electronics.
The powertrain refers to the combined set of components that generate power required to move a vehicle.
In setting up the joint venture, LG Electronics spun off a business that makes EV parts.
The Canadian company will purchase a 49 percent stake in the spun-off unit for $453 million, leaving LG Electronics with 51 percent of LG Magna e-Powertrain.
The company will be headquartered in Incheon with more than 1,000 workers. About 100 employees from the LG Electronics mobile communication division will move to the company, which has moving away from the manufacturing of handsets.
With LG Magna e-Powertrain, LG Electronics hopes to command a presence in the global EV component market.
Magna International has major automakers as customers, including General Motors, BMW, Ford, Volkswagen, Chrysler and Honda. The company produces components, like motors and inverters, for EVs from these companies.
Market watchers predict LG Magna e-Powertrain is expected to generate some 500 billion won of revenue in the second half, and about 1 trillion won in 2023.
“We anticipate the revenue for the new joint venture will increase 50 percent every year from 2022 through 2025,” LG Electronics said during a conference call earlier the year.
BY SARAH CHEA,CHOI HYUN-JU [email@example.com]