LG Electronics set to overtake Whirlpool as top home appliance maker

South Korea’s LG Electronics Inc. will likely post its best-ever sales revenue for its home appliance business this year, overtaking Whirlpool Corp. as the world’s top manufacturer of home, kitchen and laundry appliances.

According to consumer electronics market analysts on Apr. 20, LG’s home appliance and air solution division is forecast to post more than 24 trillion won ($21.5 billion) in sales this year amid the prolonged stay-at-home trend.

In contrast, Whirlpool is expected to log $20.5 billion in revenue in 2021, similar to last year’s $20.42 billion, falling behind LG for the first time.

Seoul-based Kiwoom Securities Co. expects LG’s home appliance unit to run an operating profit of 2.38 trillion won on revenue of 24.11 trillion won this year, while Hana Financial Investment Co. predicts an operating profit of 2.39 trillion won on sales of 24.89 trillion won.

In terms of operating profit, LG's home appliance division already overtook Whirlpool in 2017 and has since widened the gap by posting 470.6 billion won more than the US home appliance giant in 2020, compared to a surplus of 164.2 billion won in 2017.

LG’s home appliance revenue gap with Whirlpool has steadily narrowed, with the Korean company’s sales 600 billion won less than that of Whirlpool in 2020 versus a shortfall of 5.49 trillion won in 2017.

OBJET COLLECTION

Analysts said LG’s decent performance was led by a suite of high-class consumer goods sold under the brand of LG Objet Collection.

Launched in 2020, the new brand features a concept of “private appliance,” offering tailor-made functions depending on consumer's individual preferences, even beyond design.

LG said 11 products are currently available under the Objet Collection brand, including a refrigerator, dishwasher, lightwave oven, water purifier, washing machine and clothes care machine.

In March, about half of LG’s consumers chose goods under the Objet Collection brand, which are more profitable.

“We will continue to focus on the new brand, providing an increased lineup of goods for our clients,” said an LG official.

LG Electronics, Korea’s second-largest TV maker, last week surprised the market with forecast-beating preliminary quarterly results, led by brisk sales of TVs and other home appliances.

For the first quarter, LG said it expects its largest-ever operating profit of 1.5 trillion won, up 39.2% year on year. Overall sales likely hit a record 18.8 trillion won, up 27.7% from the year-earlier period, it said.

Earlier this month, LG announced its exit from the mobile phone business, which has accumulated operating losses of 5 trillion won, putting its focus on automotive parts and robotics as well as its flagship home appliance business. 

Write to Su-Bin Lee at lsb@hankyung.com
In-Soo Nam edited this article.