Against the backdrop of increasingly fierce competition in the global energy storage market, South Korean battery giant LG New Energy is accelerating its global production capacity layout for lithium iron phosphate batteries. Recently, the company announced that it will start the construction of a dedicated lithium iron phosphate battery production line for energy storage systems at its Wuchang factory in Chungcheongbuk do, South Korea by the end of 2025, with plans to achieve full production by 2027. This strategic initiative not only marks LG New Energy's official expansion of its lithium iron phosphate technology route in its domestic market, but also highlights the urgent demand for high safety and high economy battery technology in the global energy storage market.

Seize new opportunities in the Korean energy storage market

LG New Energy's local layout has a clear market orientation. According to the plan, the initial production capacity of lithium iron phosphate batteries in Wuchang factory is 1GWh, and flexible expansion space is reserved according to market demand. This production capacity plan forms a strategic synergy with the second round of ESS construction project promoted by the Korea Electric Power Exchange. The public project plans to construct a 540MWh energy storage system, which is expected to be completed by the end of 2027, highly in line with the commissioning time of LG's new production line. This synchronization of "capacity construction market demand" has given LG New Energy a favorable position in the new round of energy storage market competition in South Korea.

At the same time, LG New Energy emphasizes that it will expand cooperation with local suppliers of lithium iron phosphate materials, components, and equipment in South Korea, aiming to strengthen the domestic battery industry chain ecology and drive employment growth. This reflects its strategic intention to enhance cost competitiveness and supply chain security through localized supply chain construction.

Strategic shift in North American production capacity

While consolidating its domestic market, LG New Energy's capacity adjustment in the North American market is also noteworthy. In November 2025, its joint venture with Stellantis, NextStar Energy, announced the conversion of the battery production line at its Windsor factory in Canada to produce lithium iron phosphate batteries required for energy storage systems. This major adjustment means that the strategic focus of this factory, with a total investment of over 4.1 billion US dollars and an original designed annual production capacity of over 45 GWh, has shifted to the rapidly growing North American energy storage market.

This capacity conversion is not an isolated event, but rather LG New Energy's precise grasp of global market trends. With the surge in renewable energy installation in North America, the demand for grid level energy storage continues to explode, and more cost sensitive and longer cycle life lithium iron phosphate batteries are becoming the mainstream choice in the market. The shift of the Windsor factory will greatly enhance LG New Energy's supply capacity and response speed to the North American energy storage market.

Steady performance escorts strategic transformation

Behind the active strategic expansion is the sustained positive business performance of LG New Energy. According to the third quarter financial report of 2025, the company's comprehensive revenue reached 5.7 trillion Korean won, an increase of 2.4% compared to the previous quarter; The operating profit significantly increased to KRW 601.3 billion, a month on month increase of 22.2%. It is worth noting that approximately 365.5 billion Korean won comes from production incentive policy subsidies under the US Inflation Reduction Act, highlighting the policy dividends of its global localization of production capacity layout.

As of the third quarter of 2025, LG New Energy's pending orders have accumulated to around 120 GWh, providing certainty for its future capacity release and revenue growth with sufficient order volume. A healthy financial situation provides ample 'ammunition' for its technological research and development, capacity expansion, and market competition.

LG New Energy's strategic embrace of the lithium iron phosphate battery route globally indicates a profound change in the global energy storage technology route and market landscape. The South Korean battery giant, which used to oscillate between ternary and lithium iron technology routes, is now responding to market demand with more pragmatic and flexible strategies. From Gochang in South Korea to Windsor in Canada, the transformation of its global production capacity towards "lithium iron phosphate" is not only in response to the leading advantage of Chinese battery companies in the field of lithium iron phosphate, but also based on a re examination of the essential needs of the energy storage market - safety, cost, and lifespan. Keywords: New Energy Latest News, New Energy News

As the global energy transition enters a deep-water zone, energy storage has become a key component of the new power system. LG New Energy's series of layouts will enable it to occupy a more advantageous competitive position in the upcoming global energy storage market explosion, and also promote a new stage of global energy storage technology competition.Editor/Cheng Liting