LG Opens Washing-Machine Plant in Tennessee
01 June, 2019
LG on Wednesday officially opened its first home appliances plant in the U.S., the world's largest market, to take on local giant Whirlpool. LG dodged the threat of punitive U.S. tariffs on Korean washing machines by building the plant there.
With an annual production capacity of 1.2 million washing machines, the plant in Clarksville, Tennessee can roll out a washing machine every 10 seconds thanks to advanced robotics deployed at every stage of the process. Song Dae-hyun, the head of LG's home appliance division, said, "Our goal this year is two-digit growth for the washing machine business."
The plant has actually been in operation since December after U.S. President Donald Trump imposed safeguard duties of up to 50 percent on foreign washing machines in February 2018.
A man works on an assembly line at LG's plant in Clarksville, Tennessee in this undated photo. /Courtesy of LG Electronics
LG used to export some 3 million washing machines a year to the U.S. from plants in Korea, Thailand and Vietnam. It started the Tennessee plant about six months ahead of schedule to avoid the tariffs.
According to market researcher TraQline, LG's U.S. market share was 17.2 percent last year, behind market leader Samsung (19.2 percent). Together the two Korean giants ruled the market for premium washing machines costing more than US$900 with a 27 percent market share each.
That prompted Whirlpool, which is third with a 15.8 percent market share, to sue them for dumping. In fact Whirlpool still rules the roost if its market share is combined with affiliate Maytag's 15.3 percent.
Song vowed to try and maintain price competitiveness even if the punitive duties are lifted by and by.
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