LG Group to invest 9.4 trillion won in AI infrastructure, advanced manufacturing in Yeongnam region

LG Group will invest 9.4 trillion won ($6.05 billion) in the Yeongnam region to strengthen its AI infrastructure and advanced manufacturing competitiveness.

The investment will go toward boosting LG Electronics' heating, ventilation and air conditioning (HVAC) research capabilities in preparation for the expansion of AI data centers, as well as expanding LG Innotek's semiconductor substrate production capacity to meet surging demand from global big-tech companies.

LG announced Friday, on the occasion of the Yeongnam Advanced Industry Development Vision national report meeting, that it would invest 9.4 trillion won in the region by 2030.

Attendees at the meeting included LG Innotek CEO Moon Hyuk-soo, LG Electronics ES Division head Lee Jae-seong, LG Electronics HS Division head Baek Seung-tae and LG Display CFO Kim Seong-hyeon.

The group plans to concentrate on cultivating core technologies and manufacturing capabilities to underpin the AI and physical AI era — including AI data center infrastructure, optical technology serving as the "eyes" of AI, key AI semiconductor substrates and next-generation displays. Through these investments, LG aims to energize the advanced industry ecosystem and contribute to the country's manufacturing competitiveness.

LG Electronics will strengthen its HVAC research and development capabilities at its Changwon facilities to prepare for the expansion of AI data center business. The company announced last September that it would establish an HVAC research center in collaboration with Changwon National University.

LG Electronics is developing data center thermal management solutions — including chillers, large-scale refrigeration units and liquid cooling solutions (CDUs) — as a new growth engine.

The company will also expand investment in next-generation technology development for premium home appliances, centered on its Changwon plant. The facility has been transformed into a smart factory and serves as a key global production base for home appliances.

LG Innotek will pursue mass production of new optical solution models and expand semiconductor substrate production capacity in Gumi. The company signed a 600 billion won investment agreement with Gumi city in North Gyeongsang Province in March last year to produce FC-BGA (flip-chip ball grid array) substrates and high-value-added camera modules.

LG Innotek formally entered the FC-BGA substrate business in 2022, acquiring Gumi Factory No. 4 from LG Electronics and building a new substrate production line called Dream Factory. Demand for FC-BGA substrates used in AI data centers is surging, particularly for high-layer-count and ultra-large-area products.

LG Display plans to expand its production base for new next-generation display models. The company primarily produces automotive displays at its Gumi facility.