LG Electronics to Raise Prices and Shift U.S. Production Due to Tariffs

In response to potential US tariffs expected later this year, LG Electronics is considering a combination of strategic price adjustments and a shift in its manufacturing operations, according to Reuters report. 

According to a statement from senior vice president Kim I-Kueon during a recent earnings call, the company is “actively evaluating” these options to mitigate the financial impact of the looming “tariff changes”.

Also Read: LG Electronics India IPO: Rs 15,000 Crore Mega Issue - Company Files Papers With SEBI | Republic World

Price Adjustments 

As part of its contingency planning, the South Korean electronics maker is in talks with its distribution partners about raising prices on select products, including home appliances. 

While discussions are still in the early stages, the company has outlined a potential “price hike strategy” that would help offset the additional costs imposed by the tariffs. However, the final decision on price increases will depend on the exact nature and timing of the US. tariff regulations, which are expected to take effect in the third quarter of 2025, reported Reuters.

Production Relocation

Beyond price adjustments, LG is also exploring the possibility of expanding its manufacturing footprint within the US The company’s existing plant in Tennessee, which currently produces washing machines and dryers, could see an increase in production capacity. 

Industry analysts reckon that thus move could ultimately allow LG to produce a significant portion of its U.S. home appliance sales domestically, thereby reducing the impact of import tariffs.

Global Industry trend 

LG’s actions are part of a wider strategy being adopted by many global firms as they navigate an increasingly complex trade environment. Companies such as Samsung, Hyundai, and PepsiCo are also re-evaluating their production and pricing strategies in light of changing U.S. trade policies.

Present Scenario

At present, the US government has granted companies a temporary reprieve from many tariffs, with some duties being postponed until July 2025. This window gives LG and other companies more time to assess their options and adapt to any new trade policies.

LG’s management has emphasized that it is closely monitoring the situation and will make final decisions based on the evolving trade landscape, aiming to protect its profitability while delivering value to consumers.