LG expands India footprint with new $600m plant
3rd plant to strengthen local supply chain, meet rising demand for high-end home appliances
LG Electronics broke ground on its third home appliance plant in India on Thursday, investing $600 million as part of a broader push to strengthen its presence in one of the world's fastest-growing consumer markets.
The new plant, located in Sri City, a special economic zone in the southern state of Andhra Pradesh, follows the Korean tech giant's existing factories in the northern city of Noida and in the southern city of Pune. With the new facility, LG seeks to bolster its production capacity to supply appliances throughout India, as well as neighboring markets, including the Middle East, Bangladesh and Sri Lanka.
LG held a groundbreaking ceremony at the construction site in Sri City on Thursday. Attendees included: Nara Lokesh, minister for human resources development of Andhra Pradesh; Trumbalam Gooty Gharath, minister of industry and commerce of Andhra Pradesh; Lyu Jae-cheol, president of LG Electronics' Home Appliance Solution Division; Lee Jae-sung, head of LG's Eco Solution Division; and Jeon Hong-ju, managing director of LG India.
The Sri City facility will spread across 1 million square meters, with a total floor area of 220,000 square meters. When up and running, the plant will have the annual capacity to produce 800,000 refrigerators, 850,000 washing machines, 1.5 million air conditioners and 2 million air conditioner compressors.
Production is expected to begin at the end of next year, starting with air conditioners, followed by washing machines, refrigerators and compressors through 2029.
Once the new site becomes operational, LG's combined annual capacity in India will rise to 2 million televisions, 3.6 million refrigerators, 3.75 million washing machines and 4.7 million air conditioners.
"The construction of Sri City plant is a milestone that signifies LG Electronics' determination to become India's true national brand," said Lyu. "With innovative products produced through a stronger local supply chain, we will further solidify our position as India's top home appliance brand."
LG Electronics has been eyeing India as a key growth driver, as part of the tech giant's focus on the Global South, which also includes Latin America, the Middle East, Africa and Asia, for expansion and new business opportunities.
The company said India's current household penetration rate for washing machines is at 30 percent and for air conditioners at just 10 percent, suggesting major growth opportunities. The Sri City facility, along with its two existing plants, would be able to meet the fast-rising demand of premium appliances, the company explained.
The new facility will mainly produce high-end lines, such as French door refrigerators and front-loading washing machines. LG has already introduced India-specific models, such as convertible refrigerators tailored for vegetarian diets and washing machines with a dedicated cycle for traditional clothing like sarees.
The move builds on the tech giant's nearly three-decade presence in India, entering the market with its first plant in Noida in 1997, followed by a second facility in Pune.
As part of the company's India push, LG Group Chairman Koo Kwang-mo visited India in February to inspect its manufacturing facilities and R&D center.
'The next few years are critical in determining how we can differentiate ourselves and stay ahead of competitors in the Indian market. Now is the golden time to secure sustainable leadership,' Koo was quoted as saying during his visit.
LG is also seeking an initial public offering for its Indian unit this year, in a bid to tap into the country's bustling capital market. The IPO, which was valued at approximately $1.5 billion, was initially expected to be in May, but it has reportedly been delayed due to market volatility sparked by US tariff uncertainty.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Korea Herald
4 hours ago
- Korea Herald
SK Group teams up with AWS for Korea's largest W7tr AI data center
Set to launch in 2027, the mega project marks the largest corporate investment since President Lee Jae Myung took office SK Group said Sunday it has signed a partnership agreement with Amazon Web Services to expand cloud infrastructure in Korea by jointly building an artificial intelligence data center in Ulsan. SK plans to invest 7 trillion won ($5.1 billion), including $4 billion raised through investment from AWS. It is scheduled to begin operations by 2027 and generate up to 78,000 direct and indirect jobs as operations expand. Once completed, the facility will be Korea's largest AI infrastructure, powered by 60,000 graphics processing units and with a power capacity of 103 megawatts. SK will lead the construction of the data center while AWS will establish a new AI zone in Ulsan, delivering a broad selection of AWS' leading AI and cloud capabilities to customers in Korea. Ulsan is considered the optimal location for the establishment of the AI zone, as SK possesses a stable gas supply network, advanced energy solutions and ideal sites in the region. Additionally, the city offers a favorable environment for submarine cables and is highly supportive of industrial activities. The AI zone will combine industry-leading capabilities from the two companies through a 15-year partnership to provide top-tier network operations, a semiconductor supply chain and efficient power infrastructure. The partnership is in addition to AWS' long-term $5.88 billion planned investment in Korea through 2027. 'When SK Group's exceptional technical capabilities combine with AWS' comprehensive AI cloud services, we'll empower customers of all sizes, across all industries here in Korea to build and innovate with safe, secure AI technologies,' said Prasad Kalyanaraman, vice president of infrastructure services at AWS. 'This partnership represents our commitment to Korea's AI future, and I couldn't be more excited about what we'll achieve together.' SK and AWS are expanding their strategic partnership to pursue wide-ranging collaborations that will benefit customers, giving them the ability to meet the growing demand for generative AI with compute, storage, database and edge computing capabilities. The new cloud infrastructure is a part of the AI Infrastructure Superhighway strategy announced last year by SK Telecom, which is involved in AI initiatives within the Group. SK expects to establish a key hub for hyperscale AI infrastructure through the superhighway project. It plans to enhance data sovereignty and strengthen its global competitiveness in AI by processing AI workloads generated in Korea directly within the country. 'We are pleased to combine the technological capabilities of SK Group with AWS, the world's leading cloud provider, to establish a core infrastructure for a Korean AI ecosystem and create a powerful new engine for 'AI highway,'" said Chey Tae-won, chairman of SK Group. SK and AWS held a signing ceremony to launch a project to build an AI data center on Friday in Ulsan with President Lee Jae Myung in attendance. Lee vowed full-scale support for AI to create a new growth engine. 'The new government will make every effort to actively support Korea in adopting AI as a new national growth engine so that the country can once again leap forward as a dynamic, growing nation,' the president said.
Korea Herald
4 hours ago
- Korea Herald
Trump's attack on Iranian nuclear sites sparks fears for Korean economy
South Korea's economy has enjoyed a boost since the inauguration of President Lee Jae Myung, but now finds itself bracing for the impact of the US attacks on three of Iran's core nuclear sites — Fordow, Natanz and Isfahan. On Sunday, US President Donald Trump said in an address at the White House that Tehran's 'key nuclear enrichment facilities' had been 'completely and totally obliterated' by US forces. 'There will be either peace, or there will be tragedy for Iran, far greater than we have witnessed over the last eight days,' noted Trump, adding that the US will go after other targets if Iran does not agree to peace. Industry insiders here are concerned that this escalation of the conflict in the Middle East may increase oil prices in Korea, which imports approximately 70 percent of its crude oil from the region. Even before the direct intervention of the US, Korea's oil price had soared after an uptick in global crude oil prices, primarily driven by the ongoing Israel-Iran conflict that started June 13. As of Friday, Key international oil benchmarks — WTI Crude and Brent Crude — surged 5.29 percent and 3.75 percent to $76.84 and $77.01 per barrel, respectively, compared to June 13. According to the Korea National Oil Corporation, domestic gasoline prices for the third week of June rose by 0.48 percent from the previous week, reaching 1,635.5 won per liter. 'A rise in global crude oil prices could lead to several economic uncertainties, including fluctuations in Korean companies' stock prices and government bonds,' said Kim Tae-hwang, an international trade professor at Myongji University. Kim warned of a worst-case scenario in which Iran pursues retaliatory actions, including blocking one of the most important passages for oil tankers, the 'Strait of Hormuz.' This could negatively impact Korean companies, with skyrocketing maritime freight rates and disruption in the global supply chain. Kang Jin-hyuk, a researcher at Shinhan Investment Corp., also stated in a report on Friday that the key factor is whether or not Iran would shut down the Strait of Hormuz. "However, Iran's leverage could be limited by potential backlash from disrupting oil exports to allies like China, economic harm from controlling a strait crucial for 85 percent of its trade and the US' capacity to offset oil shocks with shale gas production," said Kang. 'If the conflict between the US and Iran goes on, and this does not necessarily include the onset of World War III — which is unlikely — but a prolonged stalemate in their nuclear negotiations could extend market uncertainty,' said Kim. 'This situation might force the Bank of Korea to raise the base rate, potentially leading to inflation.' The Industry of Trade, Industry and Energy held an emergency meeting later in the day to assess the potential impact the US airstrikes on Iran's nuclear sites could have on domestic industries. The ministry will examine the current status of domestic crude oil and liquefied natural gas supplies, the operation of oil tankers and LNG carriers on Middle Eastern routes, and response measures for possible logistics disruptions. The ministry explained that it has secured approximately 200 days' worth of oil reserves and natural gas stocks, ensuring no immediate supply glitches.
Korea Herald
6 hours ago
- Korea Herald
Trump's attack on Iran nuclear sites sparks fears on Korean economy
South Korea's economy has enjoyed a boost since the inauguration of President Lee Jae Myung, but now finds itself bracing for the impact of the US' attacks on three of Iran's core nuclear sites — Fordow, Natanz and Isfahan. On Sunday, US President Donald Trump said in an address at the White House that Tehran's 'key nuclear enrichment facilities' had been 'completely and totally obliterated' by US forces. 'There will be either peace, or there will be tragedy for Iran, far greater than we have witnessed over the last eight days,' noted Trump, adding that the US will go after other targets if Iran does not agree to peace. Industry insiders here are concerned that this escalation of the conflict in the Middle East may increase oil prices in Korea, which imports approximately 70 percent of its crude oil from the region. Even before the direct intervention of the US, Korea's oil price had soared after an uptick in global crude oil prices, primarily driven by the ongoing Israel-Iran conflict that started June 13. As of Friday, Key international oil benchmarks — WTI Crude and Brent Crude — surged 5.29 percent and 3.75 percent to $76.84 and $77.01 per barrel, respectively, compared to June 13. According to the Korea National Oil Corporation, domestic gasoline prices for the third week of June rose by 0.48 percent from the previous week, reaching 1,635.5 won per liter. 'A rise in global crude oil prices could lead to several economic uncertainties, including fluctuations in Korean companies' stock prices and government bonds,' said Kim Tae-hwang, an international trade professor at Myongji University. Kim warned of a worst-case scenario in which Iran pursues retaliatory actions, including blocking one of the most important passages for oil tankers, the 'Strait of Hormuz.' This could negatively impact Korean companies, with skyrocketing maritime freight rates and disruption in the global supply chain. Kang Jin-hyuk, a researcher at Shinhan Investment Corp., also stated in a report on Friday that the key factor is whether or not Iran would shut down the Strait of Hormuz. "However, Iran's leverage could be limited by potential backlash from disrupting oil exports to allies like China, economic harm from controlling a strait crucial for 85 percent of its trade and the US' capacity to offset oil shocks with shale gas production," said Kang. 'If the conflict between the US and Iran goes on, and this does not necessarily include the onset of World War III — which is unlikely — but a prolonged stalemate in their nuclear negotiations could extend market uncertainty,' said Kim. 'This situation might force the Bank of Korea to raise the base rate, potentially leading to inflation.' The Industry of Trade, Industry and Energy held an emergency meeting later in the day to assess the potential impact the US airstrikes on Iran's nuclear sites could have on domestic industries. The ministry will examine the current status of domestic crude oil and liquefied natural gas supplies, the operation of oil tankers and LNG carriers on Middle Eastern routes, and response measures for possible logistics disruptions. The ministry explained that it has secured approximately 200 days' worth of oil reserves and natural gas stocks, ensuring no immediate supply glitches.
