Amid the growing presence of Chinese household appliance factories in Thailand, LG Thailand anticipates intensified price competition in the market.
In September, Chinese household appliance manufacturer Haier opened a 10-billion-baht air conditioner plant in Chon Buri. The first phase has an annual capacity of 3 million units, with plans to double the output to 6 million units by 2027.
Hisense, another Chinese home appliance maker, announced a 4.7-billion-baht investment in Thailand to establish a manufacturing park in Chon Buri. The first phase of the operation, expected to open in 2026, is slated to produce refrigerators and washing machines.
“The industry could see more aggressive price competition,” said Amnaj Singhachan, head of marketing at LG Electronics (Thailand) Co Ltd.
He warned such intense price competition may not be good for the market in the long run.
Mr Amnaj said he believes distributors would prefer not to see the market heading in that direction.
He emphasised LG will not pursue a price-cutting strategy or engage in price wars. The company aims to focus on communicating the quality of its products and services.
Varapong Oupakaew, the company’s plant director, said LG established a factory in Rayong’s Pluak Daeng district in 1997.
The facility has a total annual production capacity of 5.5 million units, with more than 80% of its output exported to the Americas, the Middle East, Canada, Mexico and Australia.
Regarding trade regulations for products exported to the US, LG’s network in the US will provide further details and the firm in Thailand will adjust accordingly, Mr Varapong said.
He said the firm can utilise multiple sourcing for raw materials.
The company plans to source more materials from local suppliers, rising from 70% to 80-90% in the future.
Mr Varapong said this move would encourage partner investments in Thailand, ultimately creating more jobs for local workers.
Moreover, working with local suppliers streamlines parts management, allowing LG to source parts on demand and reduce the need for excess inventory.