South Korean tech giant LG has unexpectedly abandoned the manufacture of photovoltaic solar panels, citing bad times in the global market, such as the rising cost of raw materials and “intensifying price competition”.
LG Electric reported that the decision to wind up the company’s solar panel business had been approved by the board of directors on Tuesday night, and was expected to become a reality as of June 30 this year.
The decision comes at a time when uncertainty in the global solar panel business continues to rise due to a number of contributing factors.
The company’s departure, which appears to have come as a surprise to the industry, comes just weeks after LG launched its 2022 range of rooftop solar panels, the LG NeON H+ solar range, which includes the flagship LG NeON H+ of 415W.
LG said it would continue to support its brand and maintain the guarantee to customers of existing LG solar panels “for a period of time after the closure of the company.”
The company also stressed that solar panel production would continue until the second quarter of the year, “to maintain adequate stock for future service support.”
And while leaving the solar panel manufacturing market behind, LG has vowed to continue to focus on developing solar batteries for homes and businesses, as part of a reorganization of its Business Solutions Company, which housed the solar arm.
In the future, LG will leverage its renewable energy expertise to create value for its customers.
The company will focus on growth sectors and enter a new era of sustainability through rapidly evolving products and solutions, such as energy storage system (ESS), energy management solutions and other advances still unannounced.
The sudden exit of such a large and growing player in solar panel manufacturing underscores the strains the global market has been under over the past two years, as supply chain bottlenecks and shortages of materials and components brought companies to the brink of the abyss.
The high quality of LG’s solar panels, mostly made in Korea, offered a point of difference in the market that, like so many others, has been dominated by panels made in China.
The question now is which brands can be trusted, if a large company like this does not work, the guarantees of more than 20 years on photovoltaic panels can become a dead letter.