As the electric-car revolution slowly gains momentum, more and more companies are making investments to support this seismic shift. On Wednesday, South Korea’s LG Electronics announced it’s forming a joint venture with Canadian automotive supplier Magna International, CNBC reports. The tie-up will focus on building power inverters, electric motors and onboard chargers, among other items — components that are all required for electric vehicles.
This new partnership will likely be called LG Magna e-Powertrain. Ownership of the new outfit will be split between the two parent companies, with LG holding 51% of it and Magna the remaining 49%, with a total value of around $1 billion. The deal is not complete just yet, though it’s expected to be a done deal by July of next year. Shareholder approval and other conditions still need to be met.
Once the ink is dry, the new partnership is expected to employ around 1,000 people. They will work at LG facilities in Seoul, China and the US. Both Magna and LG have extensive experience building components for electric vehicles. The former makes parts forand the latter provides motors and battery packs to GM for the hatchback.
This LG-Magna joint venture is the latest in a wave of partnerships and consolidations in the automotive industry. Aisin, Seiki, Denso andcreated a combined firm called BluE Nexus, and BorgWarner recently bought Delphi. More corporate tie-ups like these are entirely possible in the near future, which should keep things moving in the electric vehicle market.