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Press Release

01/23/2006

LG Targets European Market by Building a Stronghold in Poland

LG Electronics (LG), a leader in consumer electronics and telecommunications, signed an investment contract today with the Polish Government to build a plant in Wroclaw to produce home appliances and LCD TVs.

With a total investment of 101 million euros by 2011, the plant will have an annual production capacity of 500,000 units of refrigerators and 3,500,000 units of LCD TVs. While construction of the plant will start early this year, the plant will be fully operated in the first quarter of 2007.

More than 50 Polish government officials attended the signing ceremony held today in Kobierzyce near Wroclaw. Attendees included Mr. Piotr Grzegorz Wozniak, the Minister of Economy, Mr. Jerzy Polaczek, the Minister of Transport and Construction, and Mr. Rafal Dutkiewicz, the Mayer of Wroclaw, the town where the plant site will be located. Mr. Yoon Byeng-Do, the President and CEO of LG Electronics Wroclaw and Mr. No Seog-Ho, President and CEO of LG Electronics Mlawa where LG's DTV plant is situated, also attended the ceremony.

Mr. Yoon Byeng-Do said: "The investment will boost the Polish economy and LG's competitiveness in Europe by significantly reducing distribution and labor costs. This is a win-win strategy for everyone."

Adjacent to Russia and with a highway leading to Western Europe, Wroclaw is a strategic stronghold for industry and transportation in South West Poland. The city's excellent labor supply makes it an ideal location for LG to establish a production plant targeting Europe.

The construction is expected to generate approximately 5,000 new jobs in the area and LG will award cash grants, tax exemptions and financial support to the value of several million US dollars.

"The Wroclaw plant will play a key role in LG becoming the leading producer of premium home appliances and cutting-edge displays in Europe. The plant will produce LG's Tromm brand washing machines, system air conditioners and two-door refrigerators, which are experiencing high demand in Europe. Together with the DTV plant in Mlawa producing Plasma and LCD TVs, the Wroclaw plant will spearhead LG's home appliance and display business in Europe,"Mr. Yoon said.

LG also expects to cooperate closely with the nearby LG.Phillips LCD plant, which has an annual capacity of 11 million LCD modules. In the case of a sudden increase in demand for LCD TVs in Europe, LG is assured of a steady supply of parts to meet a tight production deadline.

The plant in Wroclaw will be LG's 14th global production site in total and LG's third production line in Poland. LG Electronics has been cultivating its Poland Mlawa plant since 1999. The Mlawa plant has two production lines for Plasma and LCD TVs. LG's second line has opened in October 2005 to supply the ever increasing demand of flat panel displays in Europe.

LG also has global production facilities in two Korean cities, Mexico, the UK, Turkey, Thailand, Vietnam, Indonesia, Kazakhstan and Egypt.

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