LG Electronics Soars Most Since 2008 After Striking GM Bolt Deal

21 Oct 2015 | Author: | No comments yet »

GM credits LG Chem with creating much of the Chevy Bolt.

LG Electronics Inc. climbed by the most in seven years in Seoul trading after the South Korean electronics maker struck a deal to co-develop General Motors Co.’s Bolt electric vehicle.Indiabulls Real Estate Ltd. won approval to develop as many as 41 apartments and a five-star hotel on Hanover Square in London’s Mayfair district, according to the Westminster Property Association.

Home Retail Group Plc said full-year earnings will miss analysts’ estimates, citing an uncertain outlook for the Christmas sales season and higher investment in home delivery and store collection options.Toyota Motor Corp. said it will recall about 6.5 million vehicles worldwide to fix power-window switches that may short circuit and potentially lead to a fire.General Motors Co on Tuesday outlined a wide-ranging partnership with Korean electronics firm LG Corp for production of the 2017 Chevrolet Bolt electric car that could establish a blueprint for such collaborations in the future. Several LG subsidiaries, including LG Electronics and LG Chem, have worked closely with GM to develop electric motors, battery cells, dashboard displays and other electronic systems for the Bolt, which goes into production late next year in Michigan.

Historically automakers’ purchasing departments were the crowbar through which GM, Ford and Chrysler pried billions in savings from suppliers by cutting their prices and squeezing their profit margins. Pretax profit will be slightly below the bottom end of analysts’ estimates ranging from 115 million pounds ($177 million) to 140 million pounds, the Milton Keynes, England-based company said in a statement Wednesday. The two companies are highlighting their partnership at a time when GM is under pressure from Fiat Chrysler Automobiles NV Chief Executive Sergio Marchionne to explore an alliance to spread the costs of developing electric vehicles and other new technology.

Toyota said it isn’t aware of any crashes caused by the fault, which resulted from inconsistent application of a sprayed-on grease on electrical contact points in the power switch. GM Chief Executive Officer Mary Barra has rebuffed Fiat Chrysler, saying GM can improve economies of scale and advance new technology strategies in other ways. While the Volt is an extended range plug-in backed up by a small gasoline engine, the Bolt will be a pure electric vehicle with a range of at least 200 miles. Developers have been turning offices into homes in Mayfair because apartments sell for about 3,500 pounds a square foot compared with 2,800 pounds a square foot for the best office space, according to data compiled by broker Jones Lang LaSalle Inc.

Debris can accumulate where insufficient grease is applied and result in a short-circuit, causing the switch assembly to overheat and melt, potentially producing smoke and leading to fire, the company said. The GM-LG partnership is one of the most extensive yet between a U.S. automaker and an overseas supplier, and will shift more of the development and production cost for the new Chevrolet to a partner with considerable technical expertise. Alternative powertrain vehicles, whether gasoline-electric or plug-in hybrids or battery-only, are facing harsh headwinds in the U.S. market and low gas prices and Americans’ insatiable appetite for towing capacity and cargo space is fueling demand for pickup trucks, large SUVs and crossovers. While GM and others have made progress in boosting the range of their batteries and reducing weight of vehicles, the cost of producing hybrids and EVs at current sales volumes is a high hurdle. Home values in Mayfair rose 2.9 percent in the year through September, outperforming Knightsbridge and Belgravia, according to Knight Frank LLP, another broker.

The supply agreement is a coup for LG Electronics, which is trying to boost its auto business amid growing headwinds for its television and smartphone businesses. Bolt pricing will be released closer to the car’s launch, but Chevrolet has said it intends to sell it for about $30,000 after buyers apply federal and state tax credits. The broad range of products being supplied to GM could enhance LG Electronics’ auto business, which recently won contracts to supply information displays to Honda Motor Co and Volkswagen AG’s Porsche. Apple Inc has talked with German automaker BMW AG about collaborating on an Apple-designed electric car, and Google said it is talking to vehicle manufacturers about partnering on a self-driving car.

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