LG Electronics to Begin Sri City Manufacturing Next Month

LG Electronics India prepares to start compressor manufacturing at its ₹5,000-crore Sri City expansion while entering automotive electronics to strengthen its B2B business.

LG Electronics India is preparing to begin manufacturing operations at its new facility in Sri City, Andhra Pradesh, by the end of November or early December 2026. The company will initially manufacture air conditioner compressors, followed by air conditioners, as it expands its domestic production capacity and strengthens its presence in southern India. The facility will also support the company's planned entry into the automotive electronics business, creating a new business-to-business (B2B) growth avenue.

According to company executives, the first production line will have an annual capacity of approximately 1.4 million air conditioner compressors. This capacity can be expanded to more than 2 million units depending on demand. A separate air conditioner manufacturing line is also under installation and is expected to become operational shortly after the compressor line. The facility will initially serve the southern Indian market, complementing LG's existing manufacturing operations in Greater Noida and Pune.

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LG Electronics India plans to invest approximately ₹5,000 crore in manufacturing expansion by FY2029–30. The Sri City project forms a major part of this investment programme and is expected to strengthen localisation, supply chain efficiency and production capabilities. The company is also considering supplying compressors to other manufacturers if production exceeds its internal requirements.

Alongside its consumer electronics operations, LG is preparing to enter India's automotive electronics market through its Vehicle Solutions business. The company plans to begin with telematics technology, which enables vehicles to connect to the internet and exchange information. Its proposed portfolio also includes in-vehicle infotainment systems, automotive displays, digital cockpit solutions, vehicle computing and advanced driver assistance systems.

The automotive business will leverage the technology, engineering and quality capabilities of LG's South Korean headquarters, along with its established relationships with international automobile manufacturers. Manufacturing of these products is planned at the Sri City facility. The company expects the new business to expand its B2B portfolio beyond televisions and home appliances, although it has not disclosed specific customer agreements or the investment allocated to this segment.

LG is also increasing its domestic sourcing. Its localisation rate reached 58.5% in the September 2026 quarter, compared with 54% in the corresponding period last year. The company is targeting 65% localisation over the next two to three years, supported by greater domestic manufacturing and supplier development.

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Separately, LG Electronics India is expanding its research and development infrastructure with a third R&D centre in Noida, expected to become operational by the end of December 2026. The centre will focus on its Energy Solutions business.

The expansion reflects LG's broader strategy to strengthen Indian manufacturing, increase exports and diversify into technology-driven automotive solutions.