LG Electronics has suspended expansion plans for its microwave and refrigerator production lines in Hai Phong, northern Vietnam, citing the rising cost burden from new US tariffs. The decision comes despite strong financial performance in 2024 and highlights the growing impact of tariff-driven trade tensions on foreign-invested manufacturers in Vietnam, The Investor is reporting.
The articles make several key points, including:
- LG Electronics has halted expansion at its Hai Phong plant, citing US tariffs as a major factor.
- The pause affects 400 workers and was discussed at a recent Hai Phong Economic Zone Authority (HEZA) meeting.
- LG Electronics Vietnam Hai Phong reported US$3.88 billion in 2024 revenue and US$119.8 million in post-tax profit.
- Total LG investment in Vietnam has reached US$8.24 billion, with the bulk concentrated in Hai Phong.
- The baseline 10% US tariff has raised export costs, denting competitiveness and margins.
The suspension illustrates the ripple effects of US tariff policies on Vietnam’s role in global manufacturing. LG’s decision is evidence of a cautious approach being taken by export-focused FDI firms as costs rise and policy uncertainty deepens, particularly in sectors heavily dependent on the US market.
See also: What’s Next for Vietnam if Trump’s 46 Percent Tariff is Here To Stay?