November 25, 2024

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[THE INVESTOR] LG Electronics' newly-appointed CEO Jo Seong-jin said Sunday that the South Korean electronics maker will finalize its decision on setting up its first home appliance manufacturing plant in the US within the first half of this year.

“We’ve been considering the possibility of building a new plant in the US for a long time,” Jo said during a press conference at the Consumer Electronics Show in Las Vegas.

“The company expects to reach a final decision on this issue within the early half of this year. We are still in the process of reviewing various plans. Around 80 percent of the preparations have been completed so far,” he said.

The LG CEO’s remarks came amid speculations that the Korean tech giant is preparing to construct a new manufacturing base in the US — mostly likely in Nashville, Tennessee — to address US President-elect Donald Trump’s stated protectionist policies.

For one, Trump has proposed plans to punish companies that move production overseas with an import tariff of as much as 35 percent on the sale of goods back in the US, alarming American and foreign companies alike.

“There is speculation that the US government will provide favors to manufacturers based in the US. We cannot sit idly in a situation where importers are subject to grave disadvantages,” Jo said.

LG Electronics is currently working to figure out just how much of the production process will be moved to the US, including whether a product will be assembled in the US using imported parts, or take on another production model, according to Jo.

The LG Electronics executive also predicted a positive turnaround for its mobile communications, or MC, division, which has remained in the red since the second quarter of 2015 due to continually poor smartphone sales.

“We believe many things have been settled as of last year and that we can expect a positive turnaround (toward profitability) next year,” Jo said.

The LG executive also refuted speculations that the company may pull out of the smartphone business altogether should its next model meet another market failure.

“On top of its standalone value, our MC business is one we must continue to pursue for new future businesses such as robots, smart homes and home appliance integration,” he said.

Looking ahead, LG Electronics will focus on further promoting its premium home electronics brand LG SIGNATURE — which includes high-end OLED televisions, refrigerators, washing machines and dryers.

The company plans to continue expanding its LG SIGNATURE brand in Korea, the US and Europe, and to introduce the premium product line to new markets in Asia, including China, the Middle East and Central and South America.

It also wants to keep nurturing its automobile components business -- which includes manufacturing parts for in-vehicle infotainment systems, electric vehicles and advanced driver assistance systems — as well as its solar panels business.

Home robot development will form a major part of LG Electronics’ future business as well. The Korean tech firm plans to merge its capabilities in the Internet of Things technology and home appliance solutions to grow in this segment, the company said.

By Sohn Ji-young/The Korea Herald (jys@heraldcorp.com)