LS Cable & System eyes annual sales of $7.5 billion in 2030 in AI era

Industry

LS Cable & System eyes annual sales of $7.5 billion in 2030 in AI era

Published: 05 Sep. 2024, 16:10

SARAH CHEA
chea.sarah@joongang.co.kr

LS Cable & System CEO Koo Bon-kyu talks about business strategies for the cable maker during a press conference in Yeouido, western Seoul, on Thursday. [LS CABLE & SYSTEM]

LS Cable & System (C&S) is aiming for an annual rise in global sales of 60 percent to reach 10 trillion won ($7.5 billion) in 2030 with a strong push in the high-voltage cable business as the AI boom poses an increasing risk to global electricity grids.

The company is targeting the U.S. market next, with the goal of becoming the largest submarine cable supplier using its first U.S. cable factory in Virginia currently under construction.

“Only very few companies dominate the high-voltage direct current [HVDC] cable market while the demand is skyrocketing with AI becoming a key sector in all industries and the number of data centers growing,” said LS C&S CEO Koo Bon-kyu during a press conference in Yeouido, western Seoul, on Thursday.

“LS C&S will also construct plants in Britain and Vietnam to take a golden chance to move forward as the world’s most stable cable supplier.”

HVDC is more economical for transmitting large amounts of power point-to-point over long distances. At long distances, the HVDC transmission scheme generally has lower losses than a typical transmission link.

LS C&S' revenue stood at 6.2 trillion won last year.

Koo also emphasized cooperation with its subsidiaries to achieve the sales goal, working with LS Eco Energy to use its networks in overseas markets and utilizing the technology of LS Marine Solution in the construction and maintenance of cable factories, noting that global electricity demand will likely jump 2.5-fold to 62,159 terawatt-hours by 2050.

The Korean cable maker is investing $681 million in the Virginia plant, which is slated to start production in 2028.

That Virginia plant project is a confirmed recipient of large-scale financial aid from the U.S. government. Under the Inflation Reduction Act (IRA), the company is eligible to receive up to $99.9 million in credit for building a clean energy manufacturing factory while getting another $48 million from the Virginia state government.

When asked about variables the upcoming U.S. presidential election may bring, Koo said, it is nearly “impossible to withdraw the already-confirmed subsidy or scrap the IRA completely.”

"Our plant is set for operation in 2028. While a presidential term is four years, we don't see any risks at the moment."

Koo also expressed his determination for a public listing of LS C&S amid great demand for cables, but added that “it will need few years to maximize the results.”

BY SARAH CHEA [chea.sarah@joongang.co.kr]