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| This illustration shows the LG and Magna joint venture with logos of each company, Sunday. Courtesy of LG Electronics |
Talks are still underway between LG-Magna venture and AppleBy Kim Yoo-chul
In business, chief competitors are basically frenemies, as seen in the complicated Samsung-Apple partnership. Samsung needs Apple as the iPhone designer orders lots of components, while Apple also needs Samsung as it can reliably produce lots of semiconductors for its gadgets.
Unlike the high-profile Samsung-Apple partnership, LG is seeking a "next-level" partnership with Apple, from a mere supplier-client partnership to a substantial client-client partnership, amid the South Korean company's ongoing shift towards electronic vehicle supply chain-focused business-to-business (B2B) segment.
Sources said LG Electronics plans to sell Apple iPhones at the firm's nationwide retail shops branded as LG Best Shop. LG was in talks with Apple to finalize some "outstanding issues" before the release of Apple devices ― excluding its computer lineup ― at its authorized local distributors in August this year.
Of course, LG Electronics said "nothing has been decided." Sources said LG has no option but to sell Apple's core products here, as it can't afford to lose its edge in mobile marketing activities despite its withdrawal from the handset business.
As LG Electronics will only be granted the right for the sale of Apple products at the company-owned stores with Apple handling and managing warranty policies, LG Electronics' de facto approvals will help Apple better compete with Samsung Electronics for more mobile sales in the Korean market.
In terms of the total market size, Korea is not such an important market for Apple from its viewpoint. But Apple is pushing ahead for improved sales of 5G-embedded devices with Korean carriers as a litmus test before advancing other target markets. LG Electronics' Best Shop has over 400 locations across the country and it is set to complete needed procedures regarding the withdrawal of its mobile business within the next month.
The central point is this possibility follows the upcoming launch of LG Magna e-Powertrain, LG's vehicle component joint venture with Magna International. Given LG's strengths in core electric vehicle (EV) components such as displays, batteries and motors and its long-time reliable partnerships with its tech affiliates, chances are high the LG-Magna venture will win an initial volume of Apple EVs.
"Talks are still underway between the LG-Magna venture and Apple in terms of addressing outstanding issues and differentiation regarding the specifics for the production of first-generation Apple EVs," a top-ranking industry executive said by telephone, Sunday. In April, The Korea Times was the first to report that Apple was "very close" to signing an agreement with the LG-Magna venture.
"Because of the withdrawal of it smartphone business, LG is assigned and asked to fill in the void of its mobile departure. Given its strength in automotive parts, winning even a small volume of Apple EVs would help the company build momentum in assisting the group's top management initiatives at the growing EV-related businesses," another industry executive said.
LG Energy Solution trails only China's CATL for the top spot in EV batteries. LG Display operates "Apple-designated" panel lines in Gumi and Paju, regional cities in South Korea, while LG Innotek supplies camera modules to Apple and onboard cameras for vehicles.
June 27, 2021 at 01:55PM
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LG's 'bromance' with Apple intact - Korea Times
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