LG Electronics announced Wednesday its vision to transform into a "smart life solutions company" to expand customer experience, to take a leap from its core identity as a top home appliance brand.
The tech giant also set the goal to achieve a global annual revenue of 100 trillion won ($77.5 billion) by 2030, and vowed to invest 50 trillion won to drive the growth.
"LG will continue to pursue its bold vision to transform and leap forward as a smart life solutions company that connects and expands customers’ various spaces and experiences, rather than resting on its current position as the best home appliance brand that provides quality products,” LG Electronics CEO Cho Joo-wan said during a press conference announcing the corporate vision at LG Sciencepark in Seoul on Wednesday.
“We will establish a brand-new LG by reinventing the way we work and communicate toward this goal.”
Cho explained the company has set three goals under the transformation scheme: pursuing new platform-based service businesses through the advancement of its business portfolio; accelerating business-to-business connections; exploring new business areas such as electric vehicle charging and digital health.
At the core of the transformation is developing a platform connecting the company's various products with each other and to present more advanced services to enhance user experiences, Cho said. By 2030, the proportion of these three pillars in sales and operating profit is expected to increase to more than 50 percent.
To achieve mid- to long-term growth, Cho also listed electrification, servitization and digitalization as key inflection points LG will focus on in the coming years.
To achieve 100 trillion won in sales by 2030, Cho introduced the "Triple 7" plan.
“We will achieve Triple 7, which encompasses an average growth rate and operating profit of 7 percent or more as well as enterprise value to EBITDA ratio of 7,” Cho said. Last year, the company reported a total revenue of about 65 trillion won, which includes that of its affiliates except for LG Innotek.
By 2030, the company will invest more than 50 trillion won to lead qualitative growth of business, and advance the business portfolio, the CEO said. This includes an R&D investment of more than 25 trillion won, facility investment of more than 17 trillion won and strategic investment of 7 trillion won, Cho added.
Over the company's fast-growing vehicle component division that celebrates its 10-year anniversary this year, LG said it expects to achieve 10 trillion won in revenue this year, and plans to double the revenue to 20 trillion won by 2030. The division's core businesses include automotive infotainment systems, electric vehicle charging solutions, e-powertrain and lighting systems.
The company will also focus on achieving market leadership in its heating, ventilating, and air conditioning business, digital health care, metaverse and also robots in the comin years, the CEO added.
"LG is accelerating company-wide changes from corporate culture to brand communication at every customer contact point with the ultimate goal of becoming a brand that warms the hearts of customers and puts smiles on their faces while enabling customers to feel the value and philosophy of 'Life’s Good,'" Cho said.