Collaboration on Autonomous Driving with Magna and iPowertrain
Global OEM Customer Sales at Both Companies' Booths at CES 2023
[Asia Economy Reporter Moon Chaeseok] LG Electronics' VS (Vehicle Components and Systems) division, which had been operating at a loss for 26 consecutive quarters until the second quarter of last year, is awakening. The company has decided to expand its cooperation with Magna, one of the world's largest automotive parts manufacturers, on next-generation autonomous driving solutions. They plan to provide high-quality services that satisfy both customers (automakers) and consumers (drivers). The automotive components sector is drawing attention as a core area of business restructuring led by Koo Kwang-mo, Chairman of the LG Group and CEO of LG Corporation.
LG Electronics announced on the 4th that it will participate in CES 2023, the world's largest electronics and IT exhibition held in Las Vegas, USA, starting on the 5th (local time), to conduct global automaker customer sales activities. They plan to explore specific directions for collaboration. Industry insiders expect that this will not immediately lead to a memorandum of understanding (MOU).
The plan is to integrate LG Electronics' infotainment with Magna's ADAS (Advanced Driver Assistance Systems) and autonomous driving solutions. Using infotainment and ADAS technologies, they aim to develop a prototype of next-generation autonomous driving solutions to verify technological feasibility. The goal of the collaboration is to enable drivers to experience not only safety but also convenience and enjoyment.
The value chain of LG Electronics' automotive components business operates through the VS division, ZKW, and Magna e-Powertrain. LG Electronics views this collaboration with Magna as an opportunity to elevate the level of its infotainment system, one of its three core businesses.
Based on data from market research firm Strategy Analytics and LG Electronics' own estimates, as of the third quarter of last year, LG Electronics held a 23% share of the global vehicle infotainment telematics market, ranking first worldwide. In addition to telematics, it provides driving information and entertainment simultaneously through audio, video, and navigation (AVN) systems. Magna, headquartered in Ontario, Canada, is a global company supplying various parts to automakers, from powertrain components to ADAS and autonomous driving solutions. Recently, to strengthen its ADAS business, Magna acquired the ADAS division of Swedish autonomous driving company Veoneer for about 2 trillion KRW.
In this year's executive personnel changes, Eun Seok-hyun, head of LG Electronics' VS division, who was promoted to vice president in recognition of his role in turning the division profitable, said, "Through expanded collaboration with Magna, we expect to provide differentiated customer experiences not only to global automaker clients but also to drivers and passengers."
LG Magna began construction of its third electric vehicle parts production plant in Ramos Arizpe, Coahuila, Mexico, following plants in Incheon, South Korea, and Nanjing, China, in April. The production facility, with a total floor area of 25,000 square meters, was established within this year. The plant will manufacture key components such as drive motors and inverters for next-generation electric vehicles by GM (General Motors) in the United States.
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