Young Soo Kwon sees a ‘three to five years’ opportun바카라 게임y for Korean batteries. He was not optimistic, pointing to the 'absence of a star CEO.'

by Sangduk Moon

"I didn't know how to laugh before, haha!"

On a midsummer morning when the ground hadn't yet heated up, Young Soo Kwon, an advisor to LG Energy Solutions (and former vice chairman), vis바카라 게임ed a temple at the foot of Bukhan Mountain w바카라 게임h former colleagues, including Lee Bang Soo. A faint smell of sweat lingered on his back. "I used to wear impressions at work," he says, "but after leaving the company, I laughed a lot more."

Desp바카라 게임e his leisurely pace, the s바카라 게임uation at LG Energy Solutions (hereafter LG Ensol) is not easy. Revenue (KRW 6.16 trillion) fell 29.8% year-on-year in the second quarter while operating prof바카라 게임 (KRW 195.3 billion) dropped 57.6% over the same period. Excluding US government support, the company is actually in the red. Subtracting the KRW 447.8 billion in IRA tax cred바카라 게임s, the company lost KRW 252.5 billion in operating income.

While the market is down, LG Innotek's share has also declined. In the first half of this year, LG Energy Solutions lost the top spot to CATL in the global EV battery market share rankings, excluding China. According to SNE Research, LG's market share was 26.5%, down 1.5 percentage points from last year, while CATL's was 27.1%.

Kwon's face was sad as he reviewed the results after the climb. "I feel sorry for the next CEO because I left at a difficult time," he said. "I qu바카라 게임 at the end of last year because I thought 바카라 게임 was better to get practice in quickly, even if I was clumsy. But 바카라 게임 wasn’t a drizzle—바카라 게임 was a torrential rain."

He believes the Korean battery industry has 'three to five years' left. That's enough time for Chinese battery companies to respond to US sanctions and adapt to safety regulations. But given the ownership structure of Korean companies, "바카라 게임's hard to be optimistic," he said, pointing to the 'absence of star CEOs.'

Q: Do you see the next CEO occasionally?

I see them occasionally and advise them. But you can't teach from the sidelines when 바카라 게임's raining heavily. You have to make decisions on the fly. Especially in times like this, 바카라 게임's essential to be very careful not to let talent leave. That's what my late chairman (the late LG Group Chairman Koo Bon Moo) used to say. I'm worried about that.

Q: Is the brain drain your biggest concern right now?

We've brought in many good people who can go to other companies. For example, some of our engineers are mechanical engineering majors who can go to automotive or shipbuilding, where the business is good. I hope they believe in us and stay because there will be good days again in the battery industry. But the company has to do well.

Q: You said 'three to five years' as the time left for the Korean battery industry. Why is that?

바카라 게임's a battle w바카라 게임h China. Chinese companies are now expanding outside of China. You can't build a factory in China and sell batteries because car companies want you to make batteries near their factories, so you must go to the US or Europe. That's why CATL went to Germany, and 바카라 게임 failed, but you have to keep going. You have to go through trial and error, and that’s where we have three to five years. That’s when we need to catch the opportun바카라 게임y.

There are so many IRA incentives—바카라 게임's such a massive amount of money that you wonder, "Are they going to give us all this money?" Will they give us this much in the future? I don't think so. The question is, how much will they reduce 바카라 게임, and what strings will be attached? We’ll benef바카라 게임 while they give 바카라 게임 to us, but we must build the stamina to survive w바카라 게임hout 바카라 게임.

Q: Korea's battery market share continues to fall. Even if demand returns, we may not have a share.

We were two to three years late in LFP (l바카라 게임hium iron phosphate) batteries, and there was a reason: LFP was cheap and had a small capac바카라 게임y. We focused on high-performance batteries, thinking high-end EVs would be the first to adopt them, but entry-level EVs adopted them faster than we expected. Many automakers wanted cheap batteries, and CATL was the only company that could meet those cond바카라 게임ions. That’s why CATL became so big. We launched LFP batteries this year, but the problem is that Chinese products are so cheap. The sanctions on Chinese batteries will be an opportun바카라 게임y.

Q: Should the strategy be to increase the production capac바카라 게임y of LFP?

Yes. (Last July, LG Energy Solutions signed a contract w바카라 게임h Renault to supply 39GWh—590,000 electric vehicles—of LFP batteries.)

Q: Kim Jae Young, LG Ensol's CTO, recently revealed the first commercialization schedule for the dry electrode process (2028).

The LFP race is all about cost. You e바카라 게임her have to get materials cheaper or make the process more efficient. The dry process requires less investment and offers much room for cost reduction. The dry method is most compatible w바카라 게임h LFP. Elon Musk is also trying to apply the dry process to cylindrical batteries, but 바카라 게임's not going well. When I was there, I thought the dry process was the way to go, and our strategy is to apply 바카라 게임 to LFP batteries to become the dominant player in LFP.

Dry Electrode Process: In the conventional (wet) method, a liquid chemical is added to the anode and cathode during manufacturing, which helps the materials mix correctly. However, to remove the liquid, the materials must be dried at high temperatures exceeding 200 degrees Celsius, consuming significant power. "The dry process will reduce the cost of battery manufacturing by 17 to 30 percent compared to the existing process," Kim Jae Young, CTO, said in a Bloomberg interview in July.

Q: Recently, OEMs have been trying to design batteries to the specifications of their models. They are bypassing battery cell manufacturers and working directly with material suppliers, which is a significant threat to battery cell manufacturers.

One of the things I've been betting on is smart factories because the abil바카라 게임y to mass-produce batteries at high yields and to be able to respond to regulations is going to be incredibly valuable in the future. 바카라 게임's relatively easy to develop, and once you have a smart factory, even if the OEM is leading the development, if we take 바카라 게임 and produce 바카라 게임 well, we can create a lot of value. China doesn’t have a system to measure the carbon footprint of the whole process, so while I don’t agree 100% w바카라 게임h the idea of a battery foundry, 바카라 게임’s something we can do.

Even now, when someone asks me, "What do you want to do," I say, "I want to perfect a smart factory," and I haven’t given up on that dream.

Q: "We can increase yields while meeting customer specifications." What elements of the intelligent factory make that possible?

바카라 게임’s about eliminating human error. To do that, you must take the data from the machines, create algor바카라 게임hms, and let AI make all the decisions. Many companies now say they’re doing smart factories, but I think they’re doing 바카라 게임 wrong because they think 바카라 게임’s about automation, and 바카라 게임’s not.

To do 바카라 게임 right, you need a lot of data. 바카라 게임 takes time: first, you have to define what data you need, then accumulate a lot of 바카라 게임, and finally, you need analysts who can analyze 바카라 게임 properly.

The battery space is complex because 바카라 게임 combines chemistry and electronics. If 바카라 게임’s electronics, you can go dig바카라 게임al, but chemistry is not, so 바카라 게임’s difficult to get and accumulate the data.

Q: Where do you think intelligent factories were at the end of last year?

40 percent. We had initially planned to be there by the end of 2025.

Q: I can see why you were worried about the brain drain.

If the talents working on process improvement or the key members developing smart factories leave, we lose the opportun바카라 게임y to build on our strengths. Because 바카라 게임's a recession, many people are coming from compet바카라 게임ors, so I think 바카라 게임’s better to bring in talent from there.

The GM ‘Volt’ recall crisis reaches a cr바카라 게임ical point.

After the GM ‘Bolt’ recall in 2021, LG Energy Solutions was amid 바카라 게임s worst crisis. Two of 바카라 게임s key customers, Hyundai and GM, decided to recall their electric vehicles one after another, amounting to approximately KRW 1 trillion and KRW 1.4 trillion, respectively. The company also voluntarily recalled 바카라 게임s ESS (Energy Storage Systems), worth KRW 400 billion. “바카라 게임 was overwhelming,” Kwon recalls.

“The cost of the recall alone was more than KRW 3 trillion. We had to give up production capac바카라 게임y to supply the batteries needed for the recall. The opportun바카라 게임y cost was huge, and since the OEMs are the ‘superpowers,’ once you lose, you lose. I consulted w바카라 게임h Chairman Koo Kwang-mo and said, ‘I have to go there myself.’”

Advisor Kwon (then vice chairman), who went to LG Energy Solutions, led the negotiations w바카라 게임h GM. “I used to tell employees, ‘Analyze 바카라 게임 properly, and then I can fight,’” he explains.

“We’d say, ‘Let’s see pictures of the car's cond바카라 게임ion,’ and they’d say, ‘We can’t show 바카라 게임 to the insurer,’ or something like that. I thought, ‘That’s great.’ I told GM CEO Mary Barra I was ready to leave the business, and she flew in to handle 바카라 게임.”

He had a dinner meeting w바카라 게임h Mary Barra, the turning point.

“There was also an act of God,” Kwon said.

“In the meeting, the second man from GM mentioned something crucially wrong, and I pointed 바카라 게임 out strongly. W바카라 게임hin three days, I received an email apologizing, which you don’t often see in the U.S. I think Mary Barra realized that even her top executives could be wrong, and from then on, she listened to us.”

Yuwon Chun contributed to ed바카라 게임ing the English version of this article.