LG Electronics CEO Cho Joo-wan speaks during a meeting with reporters at the company's booth for CES 2025 in Las Vegas, Wednesday (local time). Courtesy of LG Electronics

LAS VEGAS — LG Electronics has announced that it has a "playbook" ready to cope with looming uncertainties stemming from radical policy changes in major economies as well as Chinese tech rivals' assertions, its CEO said Wednesday (local time), describing these challenges as the new normal.

At a press briefing held alongside the company's exhibition at CES 2025 in Las Vegas, LG Electronics CEO Cho Joo-wan outlined the company's robotics strategy, describing it as a "certain future" that the company must prepare for in order to gain an early lead.

"During CES 2025, I could observe that Chinese tech firms' rise is now at a stage that requires our actual response," Cho said. "And the responses will be about maintaining a technological gap, catching up with Chinese firms' cost-competitiveness and coming up with creative ways of operation."

During his recent outings at important international tech conventions, Cho has expressed concerns over the growing presence of Chinese appliance makers, which he views as a significant challenge for LG. This time at CES 2025, Cho said he again felt the formidable growth of Chinese makers, which compels LG to make greater efforts to maintain its current position.

"Simply put, we have to maintain our technological gap between (us and) Chinese firms," Cho said.

"In terms of cost, however, we have to catch up with Chinese firms. When we observe the supply chain of Chinese companies, there are several ideas that we can capitalize on. And lastly, we have to differentiate our ways of operations, such as home appliance subscription programs or introducing webOS." WebOS is LG's operating system for TVs which provides streaming and gaming services.

Regarding the upheavals in global trade orders, including the upcoming second Donald Trump administration's protectionist trade policies, Cho said LG has its "playbook" to cope with subsequent uncertainties.

"If geo-economic factors severely affect the foreign exchange rate or the Trump administration imposes hefty tariffs (for imports from certain countries), we can adjust manufacturing sites or introduce a swing production system, which allows the same model to be produced in various locations," Cho said. "In our playbook, there are several measures to cope with such uncertainties."

Audiences crowd LG Electronics' booth at CES 2025 at Las Vegas Convention Center, Tuesday (local time). Courtesy of LG Electronics

'Robot business is certain future'

During the press meeting, Cho shared LG's vision for robotics, mentioning the possibility of increasing the company's stake in Bear Robotics, a U.S.-based AI serving robot firm, in which LG invested $60 million last March.

"I believe the robot business is a certain future," Cho said. "You may have heard of software-defined vehicles, and I believe robots will also be redefined by software. To capitalize on the expertise of former Google engineers at Bear Robotics and the company's software architecture, we invested in Bear Robotics. Since we owns a call option to increase our stake, there may be a chance for us to increase our stake in the company."

Software-defined vehicles are a type of future vehicle that uses software to manage and control its functions and features, instead of mechanical systems.

Cho's mention of robotics came as several global electronics companies unveiled their concepts for AI-powered home robots at CES 2025. LG is set to launch its Q9 AI home robot later this year to gain an early lead in the market.

"Since LG has been leading the home appliance market so far, I believe it is fair to think that the main domain for our robot business will be home humanoids doing household chores or robotized home appliances," he said.

Regarding the company's disappointing earnings forecast for the fourth quarter of last year, Cho expressed regret, attributing exponentially increasing logistics costs. A day earlier, LG Electronics estimated that its operating profit from October to December last year would be 146.1 billion won, significantly below brokerages' consensus of 253.7 billion won.

"There were hundreds of billions of won (of additional expenses) in logistics costs," Cho said. "As Chinese firms expect Trump's reelection, they booked all shipping spaces, causing a rise of up to 70 percent in shipping costs."

He stressed, however, the underperformance is not related to the fundamental capabilities of the company.

"We are still experiencing peak growth. The current performance was impacted by one-off costs and non-recurring activities," the CEO added.