LG Electronics is accelerating growth in the Global South, a term that refers to emerging markets such as non-Western developing countries. In particular, it has set an ambitious goal of doubling sales by 2030 in India, Saudi Arabia, and Brazil, and plans to push ahead with a regional specialization and localization strategy.
On the 22nd, according to LG Electronics, combined sales last year in India, Saudi Arabia, and Brazil—the leading countries driving the Global South growth strategy—reached 6.2 trillion won, up more than 20% from 2023 two years earlier. That exceeds twice the companywide sales growth rate of LG Electronics over the same period.
The company said it is showing standout growth based on the unique potential of emerging markets despite the global economic downturn and delayed demand recovery.
LG Electronics has set a plan to double current sales in these countries by 2030. LG Electronics Chief Executive Officer (CEO) Lyu Jae-cheol also pledged this goal in his first message to employees at the end of last year.
The strategy is to maximize growth in high-potential markets to use it as a springboard for mid- to long-term companywide growth while improving a regionally skewed portfolio concentrated in advanced markets such as Korea, North America, and Europe.
As part of this strategy, the company plans to launch region-specific products and build a locally self-sufficient business infrastructure.
In the southern Brazilian state of Paraná, LG Electronics is investing more than $200 million (about 290 billion won) to build a new production facility with a land area of 767,000㎡ (about 230,000 pyeong) and a total floor area of 70,000㎡ (about 21,000 pyeong), with the goal of starting operations within the year.
The new plant will produce premium and region-appropriate products. It will help secure cost competitiveness in response to growing local demand for appliances and serve as a bridgehead for targeting the South American appliance market by producing export volumes to neighboring countries.
Combining the new plant under construction in Paraná with the existing production base in Manaus, Amazonas in the north, LG Electronics' local production capacity for premium appliances and components in Brazil is expected to increase to 7.2 million units per year.
Holding the top share in major appliances in India, the world's most populous country, LG Electronics is introducing the India-only "Essential Series," planned with consideration for local customers' tastes, lifestyles, and purchasing power.
The Essential Series consists of washing machines, air conditioners, and refrigerators, which are regarded as essential appliances by young middle-class households in India.
It is also putting effort into the Saudi Arabian market. Saudi Arabia is drawing industry attention as a region with many business-to-government (B2G) and business-to-business (B2B) opportunities tied to state-led policies and development projects based on Vision 2030.
LG Electronics entered the local market in 1995 by starting a partnership with Shaker, the largest appliance distributor, and has maintained a solid collaboration for more than 30 years. The two companies are also conducting research and development on region-specific technologies, including heating, ventilation and air conditioning (HVAC) technology that provides optimal efficiency in extremely hot environments.