In Short:
LG Electronics is focusing on increasing its share in the commercial air conditioner market in India by localizing production and enhancing maintenance services. The company is optimistic about the System Air Conditioning market in India, expecting it to grow significantly by 2028. LG is investing in local infrastructure and talent to strengthen its position in the HVAC industry globally, targeting mergers and acquisitions for growth.
LG Electronics focuses on increasing market share in India
LG Electronics is making a big push to capture a larger share of the commercial Air Conditioner market in India. Their strategy involves increasing localisation and enhancing maintenance business through a dedicated company.
Bullish on System Air Conditioning Market
The company is particularly optimistic about the System Air Conditioning (SAC) Market in India, which includes commercial, private, residential, and public infrastructure segments. According to BRG data, the SAC market in India was $530 million and is projected to reach $1,160 million by 2028. Factors contributing to this growth include economic progress, population increase, post-Covid market recovery, real estate market growth, government investments in social infrastructure, and the ‘Make in India’ policy.
Focus on Localisation and Maintenance Business
To capitalize on these opportunities, LG Electronics plans to establish a dedicated company for maintenance business in India. They have already started producing compressors for commercial AC in the country and aim to increase localisation levels gradually. James Lee, head of the Air Solution Business Unit at LG Electronics Home Appliance & Air Solution Company, emphasized the importance of enhancing localisation in phases.
Customized HVAC Solutions
With India’s diverse weather conditions, LG’s HVAC solutions play a crucial role in providing comfort. The company’s focus on locally customized products ensures Indian consumers benefit from the latest HVAC technology innovations. LG’s energy-efficient solutions not only reduce electricity consumption but also contribute to environmental conservation, aligning with India’s sustainability goals.
Investment in Infrastructure and Expertise
In addition to setting up a dedicated maintenance company, LG Electronics plans to invest in sales offices, R&D, and cultivate local HVAC expertise. Their strategic approach includes expanding the entire value chain, ensuring cost competitiveness through innovative manufacturing technology, and maintaining a robust global supply chain.
Global Growth Strategy
On a global scale, LG Electronics aims to strengthen its position in the HVAC industry through strategic mergers and acquisitions. By targeting locally competitive companies in key markets, LG enhances its capabilities and expands its market presence, establishing itself as a leader in the industry.
Commitment to Sustainability
LG Electronics is committed to revolutionizing the HVAC industry through electrification, servitization, and digitalization. The company’s investment in local infrastructure, including R&D and service networks, ensures tailored solutions that enhance comfort and sustainability. LG’s approach to HVAC is not only poised to deliver superior performance and value but also contribute to a greener future.
(The writer is in South Korea on the invitation of LG Electronics)
