By Heekyong Yang | Reuters
South Korean battery maker LG Energy Solution Ltd (LGES) (373220.KS), a major supplier to U.S. carmakers including Tesla (TSLA.O), is reassessing a $1.3 billion investment plan for a Arizona factory citing “unprecedented” economic conditions.
News that South Korea’s biggest battery maker is reviewing the plan, unveiled only three months ago, knocked LGES shares down 4.6% on Wednesday. It comes as more firms review business plans, fearing a drop in consumer demand amid roaring U.S. inflation mainly caused by global supply chain disruption.
Tesla is cutting 10% of salaried staff and pausing hiring worldwide, and its Chief Executive Elon Musk predicted last week a U.S. recession was more likely than not.
LEGS said in a statement it was currently reviewing various investment options due to the “unprecedented economic conditions and investment circumstances in the United States.”