Samsung and LG, two major South Korean electronics giants have manufacturing plants in Mexico that cater to sales in South America as well as the US. These factories have been operating under a zero tariff regime. President Donald Trump has said that his administration would impose a 25 percent tariff on products manufactured in Mexico. Samsung and LG are exploring possibilities of moving these plants to the US or to South Korea to avoid these tariffs.
CWEB analysts believe that these relocations could take place in the near future as it no longer makes financial sense to manufacture in Mexico when the tariffs become a reality soon. It would be cheaper to manufacture in the US or even in their home country—South Korea.
Sources say that Samsung is looking to move part of its dryer production from Mexico to the US. The giant electronics manufacturer has a home appliances plant in Newberry, South Carolina. The plant manufactures washing machines and it would be feasible to shift dryer production from its Queretaro, Mexico plant to its Newberry, USA plant.
In 2024, Samsung shifted part of its refrigerator production from Mexico to South Korea, anticipating tariffs as the management believed that it would be cheaper to export premium products that are manufactured in South Korea when compared with exporting them from Mexico with tariffs.
LG has a plant in Clarksville, Tennessee that manufactures washing machines and dryers. It has also acquired land close to this factory and can build additional facilities near the existing plant when it considers shifting production from Mexico to the US.
CWEB analyzes that home appliances are not the only products that could see production move from plants in Mexico to factories in the US. Automakers like Hyundai and Kia have set up assembly plants in Alabama and Georgia and these Korean giants could also expand their US production.
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