South Korea's leading tech giants -- Samsung Electronics Co. and LG Electronics Inc., -- said Wednesday they will invest a combined 10.5 trillion won (US$9.21 billion) by 2020 to develop advanced technology for cell phone and home appliances.
Kim Jong-ho, the head of electronic appliances at Samsung Electronics and Song Dae-hyun, home appliance division chief at LG Electronics, announced their domestic investment plan in a meeting with Paik Un-gyu, Minister of Trade, Industry and Energy, along with other industry officials.
The two big players said they plan to invest 6 trillion won to develop smart home appliances based on Internet of Things and big data technology and spend 2.5 trillion won in artificial intelligence and virtual reality technology to make state-of-the-art cell phones. The rest of investment will go to research and development of appliances for smart cars.
The companies said they will increase the percentage of premium home appliances in their product lineup from the current 70 percent to over 80 percent in 2020.
The trade minister welcomed their domestic investment plan and called for proactive actions to embrace the rapidly changing technology trend.
During the gathering, Samsung and LG expressed their concerns over the unfavorable business environment abroad, noting ongoing U.S. safeguard probes of their washing machines.
In June, the International Trade Commission (ITC) started a safeguard investigation into their washers at the request of American home appliance maker Whirlpool Corp. to determine whether they have hurt U.S. companies.
A safeguard action is taken to protect a domestic industry from a sudden jump in imports causing or threatening to cause injury to domestic production.
Paik said the government has delivered its opinion during the first hearing on Sept. 7 in Washington to support arguments laid forth by Samsung and LG, and will assist their efforts to overcome rising trade obstacles.
"The government has delivered its concerns over the ITC's investigation of washing machines by Samsung and LG," Paik said. "We will thoroughly respond to protectionist measures and help resolve difficulties of local companies doing businesses abroad."
The ITC is slated to make a decision by Oct. 5 on possible additional tariffs or import restrictions and deliver its recommendations to the U.S. administration.