Orders in LFP Battery Market Dominated by China
39GWh Supplied Over 5 Years... Equivalent to 590,000 Electric Vehicles
Supply of Pouch Batteries with CTP Applied
LG Energy Solution has secured a large-scale supply contract for electric vehicle LFP (Lithium Iron Phosphate) batteries in the European market, becoming the first domestic battery company to do so.
On the 1st (local time), LG Energy Solution announced that it signed a supply contract for pouch-type LFP batteries for electric vehicles with Renault's electric vehicle division 'Ampere' at Renault's headquarters in Paris, France.
The supply period is five years, from the end of 2025 to 2030, with a total supply volume of approximately 39GWh. This amount is enough to produce about 590,000 pure electric vehicles.
LG Energy Solution's LFP battery order is significant as it has penetrated the product lineup of Chinese companies in Europe, one of the three major global automobile markets. The electric vehicle LFP market is dominated by Chinese battery companies to the extent that it can be said to be their stronghold. Chinese battery companies occupy all top 10 positions in the global electric vehicle LFP market share.
LFP batteries are characterized by their use of relatively inexpensive iron and phosphate, offering better price competitiveness and safety compared to high-nickel batteries. As the electric vehicle market expands, demand for affordable electric vehicles is also increasing, leading to a rise in LFP battery demand. Domestic battery companies, which have mainly produced high-nickel batteries, have recently started developing LFP batteries.
An LG Energy Solution official said, "While Chinese battery companies are expanding their influence in the European market with low prices as their weapon, this supply contract proves not only our technological and quality competitiveness but also our price competitiveness."
The LFP batteries that LG Energy Solution will supply to Renault this time are the first pouch batteries to apply the Cell To Pack (CTP) process. Unlike conventional batteries that go through cell, module, and pack processes, CTP technology assembles the battery pack without the module process. By assembling battery cells directly into the pack, weight is reduced, and more cells can be installed in the same space as the module, increasing energy density within the same volume.
The battery cells are scheduled to be produced at LG Energy Solution's factory in Poland and will be installed in Renault's next-generation electric vehicle models.
With this contract, LG Energy Solution has established a diverse product portfolio in the pouch battery sector, ranging from premium products such as high-nickel NCMA (Nickel, Cobalt, Manganese, Aluminum) to mid-priced high-voltage Mid-Ni NCM and LFP batteries.
As major automakers are promoting the development and production of electric vehicles at various price points ahead of the full-scale growth phase of the global electric vehicle market, this contract is expected to strengthen LG Energy Solution's market competitiveness.
Kim Dong-myung, CEO of LG Energy Solution, said, "With this contract with Renault, our longest-standing European customer, LG Energy Solution's unique product competitiveness and differentiated customer value have been recognized. We will lead the European market, a fiercely competitive battleground, and accelerate global LFP battery orders, continuously providing top-level customer value through verified local supply capabilities and an unparalleled product portfolio."
LG Energy Solution and Renault signed a supply contract for LFP batteries for electric vehicles on the 1st at Renault headquarters in Paris, France. [Photo by LG Energy Solution]
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