[Agile Electronics Story] New Catchphrase in Home Appliance Industry: Capture Energy Efficiency

[Asia Economy Reporter Ki-min Lee] ‘Agile Electronics Stories’ is a corner that keenly examines small details about electronic and mechanical products and devices. From hot new products frequently appearing in advertisements and news, to nostalgic items, and puzzling products and industry terms, we will kindly cover everything with the heart of a beginner.

Following the new home appliance wars that started a few years ago, recently the topic of ‘capturing energy consumption efficiency’ has become a hot issue among home appliance companies. This is due to the government’s top-efficiency home appliance purchase cost rebate program, which has been underway since late March. Companies are fiercely competing to attract consumers with products that reduce power consumption while maintaining or improving performance.

The top-efficiency home appliance purchase cost rebate program is run by the Ministry of Trade, Industry and Energy and the Korea Energy Agency. It refunds 10% of the purchase price up to 300,000 KRW when buying energy-efficient home appliances. This initiative is part of an energy efficiency innovation strategy aimed at correcting low-efficiency energy consumption structures.

It is no wonder that this is a hot topic in the home appliance industry. According to a recent announcement by the Ministry of Trade, Industry and Energy, the rebate program spent 110.2 billion KRW, which is 73% of the 150 billion KRW budget, within just three months of implementation. The number of rebate applications submitted through the online website reached 896,695. The total purchase amount based on receipts submitted for rebate applications was 1.1613 trillion KRW.

According to the Korea Energy Agency, which is conducting the program alongside the ministry, as of the 23rd of this month, sales during the program period by major domestic home appliance manufacturers such as Samsung Electronics, LG Electronics, Winia Dimchae, Winia Daewoo, Cuckoo Electronics, Cuchen, and Otek Carrier reached 1.543 trillion KRW, about 2.3 times higher than the 662.9 billion KRW during the same period last year.

The government currently plans to triple the program budget from the current 150 billion KRW to 450 billion KRW once the third supplementary budget passes the National Assembly. The home appliances covered by the program currently include a total of 10 categories: ▲refrigerators ▲kimchi refrigerators ▲air conditioners ▲washing machines ▲water purifiers ▲electric rice cookers ▲vacuum cleaners ▲air purifiers ▲TVs ▲dehumidifiers.

Not only home appliances already covered by the program such as refrigerators, air conditioners, and TVs, but recently, first-grade competition has also been underway in the clothing dryer sector. Clothing dryers are not yet included in the top-efficiency home appliance categories, but as more companies recently receive first-grade energy efficiency certification for dryers, it is expected that they will be included in the future.

[Image source=Yonhap News]

[Image source=Yonhap News]

The market for first-grade energy efficiency dryers is currently dominated by Samsung Electronics. Samsung released 14kg and 16kg clothing dryers in March and recently launched a new 9kg small-capacity model.

LG Electronics also responded by unveiling a new 16kg capacity ‘Tromm Dryer Steam ThinQ’ with first-grade energy efficiency. Not only these two companies, but Winia Daewoo recently received first-grade energy efficiency certification from the Korea Energy Agency for its 10kg dryer. SK Magic and others manufacturing and selling clothing dryers are also reportedly developing first-grade energy-efficient dryers.

Differentiation among existing product lines is also noticeable. LG Electronics launched the industry’s first commercial stand air conditioner with first-grade energy efficiency domestically in mid-June, and Samsung Electronics on the 28th introduced a QLED TV with first-grade energy efficiency.

With the government holding the ‘Korea Together Sale’ from June 26 to July 12 to overcome COVID-19 and stimulate consumption, competition among home appliance companies is intensifying.

Samsung Electronics offers additional benefits beyond the existing 10% rebate when purchasing top-efficiency home appliances. They also hold a raffle for consumers who purchase event models, offering prizes such as 8K QLED TVs, Bespoke refrigerators, and Grande AI dryers. LG Electronics is holding a special exhibition of hit products in the first half of this year, selling limited quantities of specific models. Winia Dimchae is running a promotion that awards up to 200,000 points depending on the purchase amount when buying top-efficiency home appliances.