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Photo = Yonhap news |
[Alpha Biz= Kim Jisun] Seoul, April 24, 2025 — LG Electronics has stated that it is continuously reviewing and responding to potential tariff risks resulting from U.S. policies under the Trump administration, and is exploring price increases through discussions with distribution partners to mitigate the impact.
During the company’s Q1 earnings conference call on April 24, LG Electronics emphasized that the global macroeconomic uncertainty would persist into Q2 due to the ongoing U.S. tariff policy risks and the associated impacts on global supply chains.
To mitigate the impact of potential tariff hikes, LG Electronics is planning to optimize production sites, particularly by leveraging its existing manufacturing facilities in the U.S. and Mexico.
The company announced plans to shift more washing machine and dryer production to its Tennessee plant in the U.S., increasing the volume of U.S.-produced goods. Based on this increased production volume, LG Electronics expects to cover up to the late 10% range of its home appliance sales in the U.S.
"We are evaluating the possibility of expanding U.S.-based production products and facilities, and comparing them against the competitiveness of existing production sites under different scenarios, in response to changes in U.S. trade policies," the company said.
Additionally, LG Electronics plans to optimize its global production network using a “swing production system,” which allows for flexibility in the choice of production sites, especially for products that may face high tariffs in certain countries.
To address the upcoming U.S. tariffs, which are expected to be implemented starting in Q2, LG Electronics is also reviewing the possibility of increasing prices for certain products.
“We have already prepared a roadmap that includes manufacturing cost improvements and price hikes as part of our strategy to offset tariff impacts,” LG Electronics confirmed. “We have already completed discussions with our customers regarding price increases.”
Looking ahead, the company anticipates that the full implementation of mutual tariffs in the third and fourth quarters could significantly affect operations. "We plan to discuss these impacts with our customers separately in Q2," LG Electronics added.
AlphaBIZ Kim Jisun(stockmk2020@alphabiz.co.kr)
