LG Electronics is weighing price increases for select products and exploring a shift in home appliance production to the United States in response to looming U.S. tariffs, the South Korean company announced on Thursday. The move comes as part of LG's strategy to mitigate the financial impact of potential trade barriers.
"We are optimizing our production locations and considering price adjustments in collaboration with our distribution channels," said LG Senior Vice President Kim I-kueon during a post-earnings conference call. Kim highlighted that LG is evaluating relocating manufacturing of key appliances, such as washers and dryers, to its existing facility in Clarksville, Tennessee.
The Tennessee plant, operational since 2019, could produce up to 20% of LG’s home appliance sales in the U.S. market, Kim noted. This shift aims to reduce reliance on imports and cushion the impact of tariffs, which could significantly affect LG’s business starting in the third quarter if implemented.
U.S. President Donald Trump has temporarily delayed a broad set of tariffs on multiple trading partners until July, providing LG and other global manufacturers a brief window to adjust strategies. Kim emphasized that LG has developed a detailed plan for price hikes to offset tariff-related costs, while also exploring ways to enhance operational efficiency.
In addition to its U.S. strategy, LG is navigating challenges in other markets. Regarding its Indian unit’s delayed initial public offering (IPO), Kim stated that LG is taking a cautious approach. “We will not rush the IPO decision and are carefully assessing the optimal timing,” he said, citing market volatility and strategic priorities.
LG’s proactive measures reflect broader industry trends, as companies brace for potential disruptions in global supply chains. The company is also investing in smart manufacturing technologies at its Tennessee facility, aiming to boost production capacity and integrate advanced features like AI-driven appliance diagnostics, which could strengthen its competitive edge in the U.S. market.
As LG adapts to the evolving trade landscape, analysts expect the company to balance cost increases with consumer demand, while leveraging its global manufacturing network to maintain profitability.
Additions include details about the Tennessee plant’s history, LG’s investment in smart manufacturing, and broader industry context.
"We are optimizing our production locations and considering price adjustments in collaboration with our distribution channels," said LG Senior Vice President Kim I-kueon during a post-earnings conference call. Kim highlighted that LG is evaluating relocating manufacturing of key appliances, such as washers and dryers, to its existing facility in Clarksville, Tennessee.
The Tennessee plant, operational since 2019, could produce up to 20% of LG’s home appliance sales in the U.S. market, Kim noted. This shift aims to reduce reliance on imports and cushion the impact of tariffs, which could significantly affect LG’s business starting in the third quarter if implemented.
U.S. President Donald Trump has temporarily delayed a broad set of tariffs on multiple trading partners until July, providing LG and other global manufacturers a brief window to adjust strategies. Kim emphasized that LG has developed a detailed plan for price hikes to offset tariff-related costs, while also exploring ways to enhance operational efficiency.
In addition to its U.S. strategy, LG is navigating challenges in other markets. Regarding its Indian unit’s delayed initial public offering (IPO), Kim stated that LG is taking a cautious approach. “We will not rush the IPO decision and are carefully assessing the optimal timing,” he said, citing market volatility and strategic priorities.
LG’s proactive measures reflect broader industry trends, as companies brace for potential disruptions in global supply chains. The company is also investing in smart manufacturing technologies at its Tennessee facility, aiming to boost production capacity and integrate advanced features like AI-driven appliance diagnostics, which could strengthen its competitive edge in the U.S. market.
As LG adapts to the evolving trade landscape, analysts expect the company to balance cost increases with consumer demand, while leveraging its global manufacturing network to maintain profitability.
Additions include details about the Tennessee plant’s history, LG’s investment in smart manufacturing, and broader industry context.
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