LG Electronics Reported Q3 Profit Down 20.4% on Bolt EV Recall Costs

LG Electronics said its net profit dropped 20.4 per cent on-year in the third quarter due to costs incurred in a recall of General Motor's Bolt electric vehicles.

The South Korean tech giant said in a regulatory filing that net income came to 516.5 billion won ($440 million) in the July-September period, down from 649.2 billion won during the same period of last year.

LG Electronics said the recall of General Motor's Bolt electric vehicles hurt its bottom line.

LG Electronics said its third-quarter operating profit fell 49.6 per cent on-year to 540.7 billion won as it set aside 480 billion won for the recall cost.

The company supplied GM with battery modules that are made with battery cells from LG Energy Solution Ltd. In August, the tech firm revised down its second-quarter profit after setting aside 234.6 billion won for the recall.

LG Electronics said sales reached a record 18.79 trillion won, up 22 per cent from a year earlier on strong home appliances and television businesses, reports Yonhap news agency.

LG's main cash cow, home appliance & air solution units, maintained its solid performance in the third quarter, as LG Objet Collection products, which offer enhanced customization options, have continued to help rack up sales.

Its home entertainment division that manages the TV business drove strong sales with the popularity of OLED TV, brushing off concerns over increasing logistics and retail costs.

Global OLED TV shipments, led by LG, are projected to reach 6.5 million units by the end of this year, according to a recent report by market researcher Omdia, up from the previous estimate of 5.8 million units.