Samsung Electronics and Chinese TCL TV displayed side-by-side in a Seoul store [Yonhap News File Photo]

The home appliance and TV industries, which once propped up Korean exports, are facing an unprecedented structural crisis amidst slowing global demand and fierce competition from Chinese companies.

As a strategy to escape the deepening mire of stagnation, domestic home appliance giants Samsung Electronics and LG Electronics have each chosen different survival methods. Samsung Electronics is pursuing fundamental business restructuring with a focus on 'selection and concentration,' such as closing low-profit home appliance production lines, while LG Electronics is focusing on expanding its reach through the diversification of its global business structure and increased investment in new businesses like robotics.

According to industry sources on the 3rd, the Visual Display (VD) and Digital Appliances (DA) divisions of Samsung Electronics, responsible for the company's TV and home appliance businesses, recorded a combined annual deficit of 200 billion won last year. While they achieved a surplus of 500 billion won in the first half of last year, they incurred deficits of 100 billion won in the third quarter and 600 billion won in the fourth quarter, respectively.

The first quarter of this year showed a relatively strong performance with an operating profit of 200 billion won, but it was a decline compared to the same period last year (300 billion won). It is widely predicted that performance improvement will remain challenging in the near future due to risks such as high oil and exchange rates stemming from the Middle East conflict, rising logistics and raw material costs, coupled with slowing demand and intensifying competition from Chinese companies. The securities industry forecasts that Samsung Electronics' VD and DA divisions will incur an operating deficit of several hundred billion won again this year.

Although specific performance data by division has not been disclosed, the DA division is known to have performed less favorably compared to the VD division, which handles TVs. Samsung Electronics explained that while its profitability improved in the first quarter due to strong sales of premium and large-screen TVs, the improvement in home appliance performance was limited due to increased costs and tariff impacts, despite a recovery in air conditioner demand.

LG Electronics built-in appliances and HVAC systems [LG Electronics Provided]

LG Electronics' MS Business Headquarters, which oversees display-based product businesses like TVs, recorded an operating loss of 750.9 billion won last year, a deficit shift from the previous year. The HS Business Headquarters, responsible for home appliances, recorded an operating profit of 1.2793 trillion won, a 1.7% decrease from the previous year.

While these divisions saw improved performance in the first quarter of this year, the outlook is not entirely bright. Demand recovery may slow down due to the prolonged Middle East conflict, and cost burdens are expected to continue due to sustained high exchange rates and rising prices of semiconductors and memory, in addition to intensifying competition.

In particular, the offensive from Chinese companies in the TV market is becoming increasingly aggressive.

According to a survey by market research firm Counterpoint Research, the combined market share of Chinese companies in the global TV market based on shipments last year was 25%, surpassing the combined market share of Samsung Electronics (15%) and LG Electronics (9%) (24%) for two consecutive years.

Although Samsung Electronics maintained its No. 1 global market share as a single company, it was surpassed by China's TCL (16%) and fell to second place (13%) as of December last year. There are also predictions that a joint venture between Japan's Sony and TCL, slated to launch in April next year, will secure a combined market share in the 20% range, potentially ousting Samsung Electronics from its long-held top position in the annual TV market.

Samsung Electronics 2026 Model TV New Product Media Briefing [Yonhap News File Photo]

In response to the intensifying home appliance and TV crisis, Samsung Electronics is considering reorganizing some home appliance production lines, such as dishwashers and microwaves, which have low profitability, and transitioning to outsourced production. The Slovakian plant, its European TV production base, is scheduled to cease operations this month and will be closed after 24 years of operation. Japan's Nikkei reported that Samsung Electronics plans to withdraw from its home appliance and TV sales business in China within the year.

Instead, Samsung Electronics is focusing its efforts on premium product lines such as its 'Bespoke' series of washing machines, refrigerators, and air conditioners. At the same time, it is concentrating on high-growth businesses like heating, ventilation, and air conditioning (HVAC) and business-to-business (B2B) markets.

LG Electronics is seeking a breakthrough by expanding its business scope. The company plans to increase its market share by diversifying its business portfolio, which has primarily focused on advanced markets, to the 'Global South,' a region of emerging markets centered around the Southern Hemisphere, covering a range of products from premium to mid-to-low-priced segments. In particular, it is accelerating localization strategies with ambitious goals of doubling sales by 2030 in India, Saudi Arabia, and Brazil.

LG Electronics CEO Ryu Jae-cheol fist-bumping with LG Cloi [LG Electronics Provided]

The company is also pursuing new growth engines, including robotics. At CES 2026, the world's largest consumer electronics and IT exhibition held in January, LG Electronics showcased its AI humanoid 'LG Cloi' and 'Axium,' a brand for actuators, the core components that function as the joints and muscles of robots. The goal is to lay the foundation for the commercialization of home robots by 2028.

An industry official commented, "Although Samsung Electronics and LG Electronics have different approaches, their strategies align in pursuing the common goals of stabilizing their profit structures and securing new growth engines," adding, "The future direction of the Korean home appliance industry will also be determined by the strategic execution of these two companies."