Whirlpool Poised to Overtake LG Electronics as 'No.1 Home Appliance' Leader... "Supply Chain Issues to Persist This Year"

Whirlpool US Headquarters (Photo by Whirlpool)

[Asia Economy Reporter Jeong Hyunjin] Whirlpool, which appears to have lost the global home appliance industry's top sales position to LG Electronics last year, forecasted that supply chain issues due to the spread of the Omicron variant will continue this year, making it difficult to obtain home appliances such as washing machines and refrigerators.

On the 26th (local time), Whirlpool announced that its 2021 sales increased by 13.0% year-on-year to $21.985 billion, stating this outlook. Whirlpool explained that despite inflation, sales increased due to strong consumer demand for home appliances and price hikes caused by rising raw material costs.

The market views that Whirlpool, which had held the number one position in the global home appliance market, was overtaken by LG Electronics last year. Converting Whirlpool's sales using the average annual KRW-USD exchange rate of 1,144.60 won last year results in 25.208 trillion won. LG Electronics' H&A Division, responsible for home appliances, recorded cumulative sales of 20.5841 trillion won through the third quarter, and the industry estimates that fourth-quarter sales will exceed 6 trillion won.

Accordingly, when LG Electronics announces its earnings on the afternoon of the 27th, the number one title is expected to shift from Whirlpool to LG Electronics.

Mark Bitzer, CEO of Whirlpool, said that although they tried to increase production last year to meet demand, the spread of Omicron caused shortages of labor and parts, and he expects this situation to continue this year. He stated, "We are paying more for raw materials, labor, and transportation."

Due to rising costs, Whirlpool's net income for the fourth quarter fell 40.3% year-on-year to $298 million. The fourth-quarter earnings per share were $4.90, significantly down from $7.80 in the fourth quarter of 2020. CEO Bitzer added, "The situation will not improve in the coming months."

However, Whirlpool forecasts that its sales will grow 5-6% this year compared to last year, driven by continued strong demand for home appliances and price increases.