LG Electronics has set an ambitious goal to achieve accelerated growth in the rapidly expanding heating, ventilation, and air conditioning (HVAC) sector, aiming to outpace the market by twofold as the artificial intelligence (AI) era unfolds.
On Tuesday, LG Electronics held a press briefing at LG Science Park in Magok, western Seoul, where they unveiled the strategic direction of their Energy Solutions (ES) business unit and showcased HVAC solutions designed for AI data centers.
The company announced plans to accelerate qualitative growth by expanding its HVAC business, a key driver in the business-to-business (B2B) sector. To achieve this, LG Electronics aims to increase orders for data center-focused HVAC solutions, including liquid cooling systems, and extend the application of their ultra-large chillers to data centers. Furthermore, the company plans to establish a localized, end-to-end value chain covering research and development (R&D), production, sales, and maintenance; boost non-hardware revenue to 20% of total sales; and strengthen its business capabilities and portfolio through strategic acquisitions.
Lee Jae Sung, head of the ES business unit, stated that HVAC is a crucial driver for qualitative growth in the B2B sector, and it’s pushing forward to accelerate its heating and cooling business. Lee added that the company’s goal is to commercialize liquid cooling solutions within this year, leveraging its core technology and a winning R&D strategy to capture the AI data center cooling solutions market rapidly. Further, it aims to begin full-scale supply next year.
He further emphasized that this year, it plans to more than triple the orders for data center cooling solutions compared to last year. Noting that this will serve as a springboard for them to achieve rapid growth at twice the market rate.
The ES business unit was established as a separate entity late last year, having been spun off from the existing Home Appliances (H&A) business unit. This strategic move aims to adapt to the order-based B2B business environment swiftly, secure stable revenue streams, and effectively address the growing trend towards electrification as an alternative to fossil fuels. LG Electronics has set a target to reach 20 trillion KRW (approximately 14.6 billion USD) in HVAC business revenue by 2030.