LG Electronics CEO and Vice Chairman Jo Seong-jin speaks at a press conference at the Las Vegas Convention Center during the Consumer Electronics Show 2017, Friday. / Courtesy of LG Electronics
LAS VEGAS — LG Electronics CEO and Vice Chairman Jo Seong-jin admitted Friday (local time) that the company has felt pressure to build a home appliance manufacturing base in the U.S. because President-elect Donald Trump has threatened to tax imported goods.
At the Consumer Electronics Show (CES) 2017, Jo said, "We will be able to conclude the plan within the first half of this year. We have completed about 80 percent of the preparation."
"With President-elect Donald Trump saying the administration will favor local manufacturers in the United States, we face a disadvantage as an exporter. In such a circumstance, we cannot stand by idly," he said during his first press conference since he became company chief.
Trump has been forcing companies, American and non-American, to produce goods inside the U.S. if they want to sell them to consumers theree. Otherwise, the billionaire-turned-politician says he will impose stiff tariffs on goods from Mexico or elsewhere after he occupies the White House, Jan. 20.
Jo also said LG Electronics was reviewing the definition of "locally manufactured products" and what kind of home appliances the company should produce locally.
In a tentative earnings report for the fourth quarter last year, LG Electronics plunged into deficit, with a 35.3 billion won operating loss, hit hard by a poor performance in its mobile business.
Emphasizing that the loss was expected because the company generally focused on investment in the latter half of the year, Jo admitted that a turnaround in the mobile communications business was a must.
"We expect a turnaround in the mobile business this year as we already streamlined it last year," he said.
The CEO pledged not to give up the mobile business, highlighting its importance as a foundation for future businesses such as the internet of things (IoT), big data, cloud and robotics.
To this end, Jo said the company would seek profitable growth this year and revive a "winning spirit" throughout its business departments.
Speaking about the company's exhibition at the CES 2017, Jo said its new organic light-emitting diode (OLED) W television, which has a super-slim design, had drawn a most favorable response from local distribution partners such as Home Depot and Best Buy.
Jo also said he felt an urgent need to expedite the robotics business.
"Although we also have prepared for the robotics business, the industry seems to be moving faster than I expected," he said. "Because we don't know which way the robotics industry will advance, we will open all possibilities and speed up connecting robots to open platforms, deep learning and artificial intelligence technologies."
Jo added that the company planned to generate profit in the robotics business by selling robot vacuum cleaners and lawn-mowing robots.
"We need to raise funds to continue investment in the robotics business," he said. "But we cannot spend all the profits we generate from selling refrigerators and washers. We should break even within the robotics business."