On January 9, Patently Apple posted a report titled "LG & Samsung Set to Announce Future Plants in the U.S. Due to President-Elect Trump's 'Made in America' Pledge." Was it just political empty promises? Not in the least. One month later and we're now learning that LG Electronics has started building its new North American headquarters in the United States, investing some $300 million on the three-year project that the firm believes will generate tens of millions of dollars for the regional economy.
The Seoul-based firm said Wednesday that the building in New Jersey will open at the end of 2019. The move is part of the firm's bid to maximize efficiency by integrating its scattered offices in the U.S. into the new headquarters.
"The new building is expected to contribute some $26 million annually to the local U.S. economy by creating jobs and paying taxes," an LG Electronics official said. "While building the new headquarters, we also estimate more than 2,000 jobs will be created in the construction industry there."
The report further noted that "The project comes as the protectionist stance of U.S. President Donald Trump is feared to affect Seoul-based technology titans including LG and Samsung. He has urged non-American firms to establish manufacturing facilities in the U.S. For this reason, LG expects the new headquarters to be a milestone for its expansion there.
The U.S. market is a cash cow for LG Electronics' overseas businesses, making up some 30 percent of the firm's total sales abroad as of the end of the third quarter last year. LG's premium products, including televisions and refrigerators, have driven up its profitability there."
If that much of their profits are made in the U.S., then it's only right that they make a contribution for jobs in the U.S. as a way to say thanks.
The report further noted that "The Company's mobile business is also performing well in the U.S., accounting for 15.7 percent of the U.S. smartphone market in the third quarter, according Strategy Analytics data."
One LG official stated that "Backed by our LG SIGNATURE premium built-in kitchen appliances and high-end organic light-emitting-diode (OLED) televisions, the new American headquarters will speed up our plan to achieve a second leap forward in the U.S." The company also said employees from other LG affiliates, including LG Household & Health Care and LG CNS, will use the new building.
High-ranking officials, including LG Electronics North America CEO William Cho, Bergen County Executive James Tedesco and Larry Rockefeller, an environmental lawyer, attended the groundbreaking ceremony.
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