[New Year's Address] Shin Hak-cheol, Vice Chairman of LG Chem, "Adjusting Investment Priorities... Reviewing from Zero Base"

"Fundamental Change Needed Beyond Existing Methods"

Shin Hak-cheol, Vice Chairman of LG Chem, announced that he designates 2025 as the "Year of Execution" and will pursue proactive and aggressive portfolio advancement.

In his New Year's address on the 2nd, Vice Chairman Shin recalled, "Last year, we faced a difficult business environment and relentless challenges, including increased geopolitical uncertainties, global oversupply in petrochemicals, and a slowdown in electric vehicle growth." He added, "The external environment is unlikely to be easy this year as well. In such circumstances, survival requires a fundamental change in behavior based on a clear recognition of reality, rather than continuing with past methods."

Shin Hak-cheol, Vice Chairman of LG Chem. Photo by LG Chem

First, Vice Chairman Shin emphasized the need to strive to secure differentiated competitiveness in business. To this end, regarding cost reduction, he said, "All costs should be thoroughly analyzed from a zero base, breaking away from past practices, and efforts should be made to differentiate operating profit margins compared to peers based on customer experience-driven cost and product competitiveness."

He also mentioned the need to prioritize investments and utilize resources efficiently. He stated, "Not only costs but all investments should be reexamined from a zero base considering future 3C changes, enabling optimal resource allocation." Accordingly, he stressed the importance of enhancing overall corporate financial soundness.

Vice Chairman Shin said that research and development (R&D) must be strengthened for future competitiveness. He urged, "Let us clarify the missions of each organization and strive to link R&D to business performance," and encouraged expanding external collaborations such as open innovation and applying artificial intelligence (AI) and digital transformation (DX) to improve resource efficiency.

He emphasized that investment in the three major new growth engines requires selection and concentration. In sustainability, focus should be on the high-growth aviation fuel sector, while chemical recycling and bio-materials should internalize core technologies to be ready to enter the market with competitive advantage at any time. For battery materials, strengthen the competitive edge in cathode materials based on high-nickel products and technology, and for new drugs, improve the qualitative level of individual projects through precise and in-depth market analysis.

Additionally, he highlighted operational systems such as embedding customer-centric work methods throughout the organization and continuing to achieve zero major environmental and safety accidents.

In conclusion, Vice Chairman Shin stated, "Amid global market uncertainties and rapid changes, we stand at a point where thorough change and bold challenges are more necessary than ever," and emphasized, "Let us challenge together with all employees, grow together, and create a new history for LG Chem so that it can be recognized for its value in the market and continue to grow."