LG Electronics’ Customized Total HVAC Solution
SEOUL, Jan. 16 (Korea Bizwire) — LG Electronics is scaling back its nearly decade-long energy storage system (ESS) business to concentrate on its rapidly growing heating, ventilation, and air conditioning (HVAC) segment, bolstered by the global surge in artificial intelligence (AI).
Industry sources on January 16 revealed that LG’s Eco Solution (ES) Business Division recently rebranded its ESS division to the ESS Business Support Task Force. This restructuring shifts focus to supporting existing ESS contracts, including supply, maintenance, and preliminary development projects.
ESS technology, which stores electricity in batteries for efficient energy distribution, gained attention globally amid shifting environmental and energy policies. LG Electronics entered the ESS market in 2014 by acquiring LG Uplus’s Power Conversion System (PCS) division. However, fierce price competition from Chinese manufacturers has led to the company’s decision to scale down ESS operations.
In line with its goal to increase its business-to-business (B2B) revenue share to 45% by 2030, LG Electronics is accelerating its HVAC business expansion.
Reflecting this strategic shift, LG established the ES Business Division in late 2023, spinning off HVAC operations from the Home Appliance & Air Solution (H&A) Division to form a dedicated business unit aimed at becoming a global top-tier comprehensive air solutions provider.
Furthering its focus on AI-driven growth, LG Electronics unveiled a collaboration with Microsoft at CES 2025 in Las Vegas on January 6. The partnership centers on co-developing sustainable thermal management and chiller technologies essential for Microsoft’s next-generation AI data centers.
An LG Electronics spokesperson emphasized, “This is a strategic reduction, not a withdrawal, from the ESS business. We will continue to enhance service and product quality while concentrating our efforts on the HVAC sector.”
LG’s pivot underscores its strategy to capitalize on emerging opportunities in AI and energy-efficient technologies, aligning its business priorities with global market trends.
Kevin Lee (kevinlee@koreabizwire.com)
