Shop Talk

Retailers, consumers and prices

LG expands US appliance footprint

December 12, 2008

The recession, corporate cutbacks and lower demand for big-ticket items are not stopping LG Electronics from expanding its U.S. appliance business.

trommredThe South Korean electronics giant this week unveiled a facility in Atlanta that will be used to train engineers, contractors and sales staff how to use its commercial air conditioning products.

LG, which has been gaining U.S. appliance market share as residential customers buy its washing machines, hopes the Atlanta facility, its first commercial training center in the U.S., will help boost sales of heating and air conditioning systems to hotels, hospitals and schools.

LG is the world’s biggest maker of air conditioners.

“Consumers are looking for value,” Michael Ahn, chief executive of LG Electronics North America, said in a short interview at the training center.

“We’re seeing more (appliance) growth at the lower end than the high end” right now, Ahn added. “Total demand will be decreased next year.”

To respond to the need for value, Ahn said LG was offering lower-priced versions of its Tromm washing machine (pictured), with a washer-dryer pair priced as low as $1,200. LG has been selling major appliances in the U.S. for about six years, and caters to the premium market.

The U.S. housing slump and tighter credit has hurt appliance demand. U.S. shipments of major appliances were down about 9 percent for the year to date through late October, according to the Association of Home Appliance Manufacturers.

(Photo: LG Electronics)

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