LG Energy Solution Expects Q1 Operating Loss on Weak EV Demand

South Korean battery maker cites lower sales to major customers like Tesla and GM.

Apr. 7, 2026 at 7:49am

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A highly detailed, photorealistic studio photograph of a sleek, metallic battery cell floating against a clean white background, using dramatic lighting and shadows to convey a sense of premium quality and corporate strategy.A premium battery cell symbolizes the challenges facing South Korean battery makers as they navigate shifting EV and energy storage demands.Today in Detroit

LG Energy Solution, a major supplier of electric vehicle batteries to companies like Tesla, General Motors, and Hyundai, announced it expects to post a first-quarter operating loss of 208 billion won ($138.16 million) due to weaker demand from EV makers. The company said revenue would likely fall 2.5% year-over-year, though the loss figure includes tax credits from the U.S. Inflation Reduction Act for its U.S. battery production.

Why it matters

LG Energy Solution's struggles reflect broader challenges facing the EV battery industry, as automakers grapple with supply chain issues and lower consumer demand. The company's shift towards growing its energy storage systems (ESS) business could help offset the EV weakness, especially if a proposed U.S. bill to restrict Chinese-made ESS products creates new opportunities for South Korean battery makers.

The details

LGES, which supplies Tesla, GM, and Hyundai among others, has been dealing with weaker EV battery demand, including one of its major customers, GM, idling a Detroit EV plant until April. Excluding the tax credits, LGES would have posted an operating loss of 398 billion won. To offset the EV weakness, LGES is focusing on growing its energy storage systems (ESS) business, driven by rising electricity needs for AI data centers. Analysts also say a proposed U.S. House bill, the CHARGE Act, to ban imports of certain Chinese-made energy storage systems could create opportunities for South Korean battery makers like LGES.

  • LGES expects to report Q1 2026 earnings on April 30, 2026.
  • GM idled a Detroit EV plant until April 2026.

The players

LG Energy Solution (LGES)

A major South Korean battery maker that supplies electric vehicle batteries to companies like Tesla, General Motors, and Hyundai.

General Motors (GM)

One of LGES's major customers that idled a Detroit EV plant until April 2026 due to weaker demand.

CHARGE Act

A proposed U.S. House bill that would ban imports of certain Chinese-made energy storage systems, potentially creating opportunities for South Korean battery makers like LGES.

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What’s next

LGES is set to report full details on its Q1 2026 earnings on April 30, 2026.

The takeaway

LG Energy Solution's expected first-quarter operating loss highlights the challenges facing the EV battery industry, as automakers grapple with supply chain issues and lower consumer demand. However, the company's shift towards growing its energy storage systems business and potential opportunities from a proposed U.S. bill restricting Chinese-made products could help offset the EV weakness.