LG Innotek said on the 21st that it has completed construction of the new V3 plant at its Hai Phong manufacturing subsidiary in Vietnam and begun full-scale operations. In Jul. 2023, the company announced it would invest about 1.3 trillion won ($1 billion) in the Vietnam manufacturing subsidiary through Dec. 2025 to strengthen its optical solutions production capacity, including the V3 plant expansion.
The total gross floor area of the new V3 plant is about 150,000 square meters (about 45,000 pyeong), the size of 20 soccer fields combined. With the V3 plant expansion more than doubling camera module production capacity (CAPA) from previous levels, LG Innotek has completed the build-out of a robust global production network that can stably supply large volumes for customers.
At the same time, it is continuing to invest in optical solutions facilities in Korea. LG Innotek signed a 600 billion won investment agreement with Gumi, North Gyeongsang Province, in Mar. The company will make new facility investments at the Gumi business sites for the production of high-value-added camera modules and more by the end of next year under the agreement.
Under its dual production base strategy, LG Innotek plans to actively use the Gumi business sites as the optical solutions "mother factory," dedicated to research and development (R&D) and the production of high-value-added camera modules for new models and optical components for new applications. The Paju business sites, another domestic optical module production base, will also focus on high-value products such as camera modules and 3D sensing. The Vietnam manufacturing subsidiary will serve as a key base for producing general-purpose camera module products.
Meanwhile, beyond its dual production base strategy, LG Innotek is focusing on in-house production of key core components and boosting cost competitiveness through AX (AI transformation). As part of this, it has introduced "AI incoming raw material inspection" into its production process, cutting the time to analyze causes of material defects by up to 90%, and is maximizing production efficiency by using an "AI process recipe" to reduce the time to find the optimal process recipe from 72 hours to within six hours and improve the initial mass-production yield.
Chief Executive Moon Hyuk-soo said, "With the completion of the Vietnam V3 plant expansion, the profitability of the camera module business could gradually improve." He added, "We will expand early-stage technology proposals to customers and internalize key components."