LG Electronics exceeds 1tn won OP from car electronics, HVAC units

(Han Joo-hyung)

LG Electronics’ business-to-business units spanning car electronics and heating, ventilation and air conditioning (HVAC) delivered a combined operating profit exceeding 1 trillion won ($681.6 million) for the first time last year, overtaking the company’s core consumer-facing home appliance and TV businesses.

According to industry sources on Wednesday, LG Electronics’ Vehicle Solution (VS) Company and Eco Solution (ES) Company — the latter formed recently by combining the HVAC business with the EV charging sector — are estimated to have posted operating profits of 547 billion won and 674 billion won, respectively, for a combined 1.22 trillion won. That figure is more than double the combined operating profit of the Home Appliance & Air Solution (HS) division at 1.29 trillion won and the Media Entertainment Solution (MS) division, which posted an operating loss of 783 billion won, resulting in a net 514 billion won for the two B2C units.

It marks the first time LG Electronics’ B2B businesses have generated more operating profit than its B2C segments, a notable reversal from as recently as 2024, when home appliances and TVs produced nearly twice the operating profit of the company’s auto and HVAC units.

Analysts attribute the turnaround primarily to the rapid growth of the vehicle components business. While demand recovery for home appliances lagged and competition intensified last year, the VS division benefited from an order backlog approaching 100 trillion won that translated into stable revenue. Rising consumer preference for advanced infotainment systems also boosted profitability, as LG increased the share of premium products supplied to automakers.

Operating profit at the VS division surged to 547 billion won last year, nearly five times the 116 billion won recorded a year earlier.

The performance is widely seen as validating LG Electronics’ long-emphasized strategy of shifting its business mix toward B2B operations amid mounting pressure on consumer electronics from aggressive Chinese competitors, tariffs and broader global uncertainty. B2B businesses typically face higher entry barriers and customer switching costs but are less exposed to short-term market swings once established, making them a potential new cash cow for the company.

LG Electronics is also broadening the ES division’s portfolio beyond residential applications into commercial and industrial markets, while expanding maintenance services and its global manufacturing network to sustain growth. Leveraging comprehensive cooling technologies that cover both air and liquid, the company plans to step up efforts to secure future opportunities in AI data center cooling solutions.

Chief Executive Officer Ryu Jae-chul underscored the importance of B2B expansion in a New Year message last December, calling for greater focus on B2B, solution-based businesses and direct-to-consumer sales to accelerate qualitative growth. He reiterated the push during a press briefing at CES 2026 in Las Vegas in January, citing auto components and HVAC as key pillars of a “high-performance portfolio transformation.”

Separately, LG Electronics said it will launch its 2026 Whisen Objet Collection air conditioner on Thursday, featuring the company’s first “AI Cold Free” function that simultaneously controls temperature and humidity. The model also includes AI-powered airflow, voice recognition and sleep modes that adjust operation based on user location and conditions.