Ryu Jae-chul, Head of LG Home Appliances and Air Solutions Division, introduces a new range of upgradable home appliances: LG UP Appliances 2.0
LG Electronics Inc. on Tuesday unveiled a new line of home appliances that can be upgraded via apps like a smartphone, as the company aims to evolve into a platform-based tech giant.
The South Korean home appliance maker also said it will expand its business scope to become a customer service provider offering a subscription-based business model, not to mention a hardware maker.
Under the “UP Appliances 2.0” brand, LG introduced four new upgradable electronics appliances – a washing machine, a dryer, a refrigerator and an air purifier – and announced that it would gradually expand the range of these products.
With the new range, consumers can update their home appliances through the smart home ThinQ application to add new functions and features. They can also remove functions or features that they don’t use often.
LG wants to become a Home as a Service provider
“Through software updates, just like a smartphone operating system, you can add features to products you’ve already purchased,” Ryu Jae-chul, president and head of LG’s Device and Air Solutions Division, said at a news conference at LG Science Park, the company’s research center.
“UP Appliances 2.0 marks the starting point of our transition to a services-based enterprise. We will lead the industry paradigm shift towards HaaS or Home as a Service,” he said.
In order to make its home appliances upgradeable, LG claims to have developed a new AI chip for smart home appliances called DQ-C and a new operating system.
LG launched a range of upgradeable home appliances last year to meet various consumer needs.
LG’s signature home appliances
SUBSCRIPTION BUSINESS MODEL
LG said it has also worked with service providers to make housework easier for customers.
The company has partnered with Laundrygo to offer contactless laundry services. In cooperation with LG Household & Health Care Ltd. It offers a laundry detergent delivery service.
LG also offers an assistance service through Daerijubu, a household cleaning company.
Separately, LG Electronics is adopting a subscription business model to provide free product maintenance and repair services to its consumers.
Consumers can choose a subscription period between 3 and 6 years.
Cho Joo-wan, CEO of LG Electronics, unveils the company’s new business strategy at LG Science Park in Seoul on July 12
The launch of the UP Appliances 2.0 product line comes as a follow-up to the company’s Vision 2030 strategy announced in mid-July.
CEO Cho Joo-wan unveiled a new business strategy aimed at transforming itself from a traditional home appliance maker into a platform-based tech giant, saying LG aims to achieve annual sales of 100 trillion won ($77.5 billion) by 2030, a significant increase from 65 trillion won in 2022.
As part of his 2030 vision, the CEO said LG will pursue three growth drivers: increasing sales of non-hardware products, promoting the business-to-business (B2B) model, and exploring new growth areas such as electric vehicle charging and digital health.
The three sectors would account for more than half of LG’s annual sales and operating profit by 2030, he said.
write to Ye-Rin Choi at rambutan@hankyung.com
In-Soo Nam edited this article.
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