LG Electronics is looking to revolutionise the heating, ventilation and air-conditioning (HVAC) industry. The South Korea-based manufacturer is expected to make substantial investments in the coming years in India and other countries to enhance the quality of its HVAC systems — or system air-conditioners (SAC), which are primarily used for commercial and industrial purposes, company executives told reporters.
The HVAC consists of premium air-conditioners, air purifiers, air-handling units, and energy recovery ventilators, etc.
So far, LG Electronics manufactures HVAC systems in 11 countries. In India, the company manufactures the products at its Pune unit. LG has another manufacturing plant in Greater Noida, but SACs are not manufactured in that unit.
To expand production and sales of HVAC products in India, LG is aiming to increase its production capacity and improve quality by investing in research & development; enhancing the share of locally used raw materials in production of compressors and other components; and focusing on maintenance of the products through a different company–which was established recently, the executives said.
“In India, where climate control is essential for maintaining comfort in diverse weather conditions, LG’s HVAC solutions are particularly relevant,” the official statement said.
“The company’s focus on locally-customised products ensures that Indian consumers benefit from the latest advancements in HVAC technology,” it added.
As of now, around 50% of raw material used for production of HVAC components are sourced locally in India, which is likely to go up gradually going forward, said James Lee, head of air solution business unit at LG Electronics Home Appliance & Air Solution Company, Korea. “However, not all materials can be sourced from India and would be required to be imported from Korea,” he added.
Lee said the enhanced focus on HVAC in India is due to rapid urbanisation in the country, the rise in middle class population, a sharp rise in foreign direct investments for commercial offices, rapid rise in real estate market, and the government’s major focus on providing incentives for production through PLI and Gati Shakti.
According to a survey by BRG Group, the commercial AC market in India is expected to rise to $1.16 billion by 2028.
“Our investment in local infrastructure, including R&D, distribution, and service networks, ensures that we provide tailored solutions that enhance comfort and sustainability,” Lee said.
LG is also planning to set up more HVAC training centres in India to improve its workers’ skill quality. Currently, six such centres exist – in Noida, Pune, Mumbai, Chennai, Kolkata and Bengaluru.
Besides, the company is pursuing strategic mergers and acquisitions, targeting locally competitive companies in key markets, to further strengthen its position in the global HVAC market.
The writer is in Seoul at the invitation of LG Electronics