LG is set to expand beyond consumer goods, transforming itself into a business-to-business (B2B) giant as it eyes smart factories for future growth.
According to The Korea Economic Daily, LG recently launched a smart factory business division under its research and development center, signaling a significant shift from its traditional home appliances brand.
The South Korean giant has identified B2B services, specifically for smart factories, as its new growth area. It aims to leverage its domestic and overseas plants in conjunction with its operating expertise. Smart factories offer the promise of fully automated production processes, from assembly to packaging, while also utilizing big data and deep learning technology to enhance work and power usage efficiency.
The company’s smart factory division, comprising dozens of employees, will spearhead automated technology development. This includes mobile robot systems to manage the sales process, from automated factory design to construction and management know-how.
Market tracker Statista predicts the global smart factory market will grow to $244.8 billion this year, up from $153.7 billion in 2019. LG is set to tap into this market growth by offering turnkey services for smart factories, covering the entire automation process from planning, designing, building, and operating them.
Currently, most smart factory projects focus on consulting and upgrading parts of production lines. However, LG’s approach is holistic, extending beyond mere construction to provide ongoing consulting at the factory upgrade level.
Smart factories collect and process data in real time through the Internet of Things (IoT), analyzing the information to control each process. With companies globally seeking to enhance production efficiency through digital transformation, the demand for smart factories is on the rise.
The Korea Economic Daily reports that LG has already converted part of its six home appliance production lines into smart facilities at its main production base in Changwon, South Gyeongsang Province, as well as at its home appliance plant in the US state of Tennessee.