South Korean battery manufacturer LG Energy Solution has inked a new battery supply agreement worth 2.06 trillion won (about US$1.4 billion) with Mercedes-Benz, marking the fourth major with German luxury automaker in just two years.
Under the deal, LG Energy will supply batteries to the German automaker from March 2028 through June 2035. While the company did not specify the exact battery type or volume, industry analysts expect the order to include 15–20 gigawatt hours (GWh) of lithium iron phosphate (LFP) batteries, a chemistry commonly used in mid-range and entry-level electric vehicles.
This latest agreement builds on a rapidly expanding partnership. In October of last year, LG Energy signed a 50.5 GWh contract with Mercedes-Benz. That was followed by two additional deals announced in September totaling 75 GWh and 32 GWh, together valued at around $11 billion.
With the addition of the new $1.4 billion contract, LG Energy’s total battery supply commitments to Mercedes-Benz now amount to approximately $16 billion.
The company is also ramping up production of more advanced, high-energy-density batteries, including 46-series cylindrical cells, as it prepares to support a wider range of Mercedes-Benz EV models.
The timing of the deal aligns with reports that Mercedes-Benz is shifting its strategy away from a strictly luxury-focused EV lineup and moving toward more affordable, mass-market electric vehicles. Analysts say LG Energy’s increasingly diverse product lineup positions it well for this transition. The LFP batteries for the new contract will be produced at LG Energy’s plants in the United States and Europe.
[source: The Korea Times]“Our partnership with Mercedes-Benz is strengthening across our vehicle component businesses,” said an LG Group official. “Cooperation will continue to expand across the broader electric-vehicle ecosystem, including batteries.”
