LG Electronics Inc. expects sales of its home appliances division, the key cash cow of the South Korean company, to remain steady at 30 trillion won ($23 billion) in 2023, in line with the company's aggressive investment plan announced last month, according to industry sources on Thursday.
LG’s home appliance and air solution (H&A) division recently finalized its business and sales strategies based on the revenue forecast, which industry observers said seemed challenging in light of the gloomy industry outlook.
But the sales target comes as Whirlpool Corp., with which LG has been competing for the industry's top spot, has been expanding its presence in the Middle East and Africa.
The US home appliances giant is forecast to post $19 billion in sales this year, below LG’s target of $23 billion, according to a consensus forecast of investment banks.
Last year, LG's H&A division posted a 10.3% increase in sales to 29.9 trillion won from a year earlier.
LG's cleaning robots LG overtook Whirlpool in 2020 for the first time to become the world’s largest home appliances company in terms of sales. Last year, it beat its US rival by operating profit as well.
South Korea’s home appliance sales have dwindled 13.3% on-year to 5.2 trillion won in the first two months of this year, according to Statistics Korea.
However, LG bets that its key products such as dryers, dishwashers, cleaning robots and clothing steamer closets will lead the division's sales growth.
In addition, H&A division head Ryu Jae-cheol said its air source heat pump Therma V, which can replace gas boilers, will likely drive its sales growth higher, particularly in Europe.
He expects that the heat product's sales will likely more than double in 2023 from last year.
