LG Energy Solutions has reached an agreement with GM to share half of the compensation cost of 1.4 trillion won with General Motors (GM) in relation to the recall of the Chevrolet Bolt electric vehicle fire.
GM decided to recall a total of 142,000 units of Bolt electric vehicles in July (69,000 units) and August (73,000 units), which had a series of fires. As the three companies agreed to a recall cost of 1.4 trillion won, the recall cost, which was expected to be $1.8 billion (about 2.13 trillion won) at the time of the recall decision, has decreased by 34%.
According to this agreement, LG Energy Solution and LG Electronics set up a provision of 700 billion won each. LG Energy Solutions set a provision for KRW 91 billion in the second quarter, and decided to set an additional KRW 620 billion for the third quarter on the same day.
In addition, LG Energy Solutions plans to resume the IPO process, which was temporarily suspended as the agreement on the recall measures was concluded.
Reporter Lee Ji-sun stockmk2020@gmail.com
