LG is concerned about the growing economic protectionism in the United States, Korea JoongAng Daily reported Wednesday, claiming LG Group Vice Chairman Koo Bon-joon recently instructed the company's senior executives to review their long-term stateside plans in order to account for what he feels is a "deteriorating" environment. While speaking at an internal seminar held in LG's Seoul headquarters on Tuesday, Mr. Koo is said to have told some 400 executives to prepare for added "uncertainty" that's likely to reflect on the firm's Q1 2018 results. The South Korean original equipment manufacturer is still expected to maintain its focus on home appliances and cosmetics, two segments in which it has been massively successful in recent years, with Mr. Koo reportedly reiterating that long-term plan earlier this week.
The company was recently hit with increased U.S. tariffs on washing machines imposed by President Donald Trump's administration earlier this year. Washington is now seeking a 20-percent import tax on the first 1.2 million washers any foreign firm brings to the country on an annual basis, whereas every subsequent unit is taxed at a 50-percent rate. The move forced appliance manufacturers such as LG and Samsung to raise their prices and hurt their sales, consequently taking a significant hit on their profit margins in the country. Washington's growing protectionism is also affecting Chinese companies attempting to do business in the U.S., albeit its efforts to block the likes of Huawei and ZTE also stem from various spying concerns raised by some intelligence agencies in recent months.
While LG has been enjoying largely positive performance in the last several years, the company's smartphone business is still struggling and losing hundreds of millions of dollars on a quarterly basis. The Seoul-based firm recently opted to revamp its mobile operations by dropping its arbitrary 12-month release cycles for entirely new models and is now shifting its resources to more incremental flagship revisions such as the V30S ThinQ. The tech giant's next major smartphone launch is rumored to be scheduled for June when the successor to the 2016 G6 is expected to be unveiled. The LG V30S ThinQ is set to be released in select markets later this month.