LG Electronics and LS Electric have teamed up to enhance their smart factory leadership and foray into overseas markets together, the companies said Wednesday.

Their strategic alliance, formalized through a memorandum of understanding signed Tuesday, aims to leverage the combined technological prowess and market influence of both entities to forge advancements in the smart factory sector, including digital solutions, automation, and energy efficiency.

LS Electric is set to contribute its core technologies — including an internet of things-based system for automated equipment modeling, autonomous logistics robots for internal operations and an AI-driven real-time automatic welding system — drawing on its expertise from the LS Electric plant in Cheongju, North Chungcheong Province.

LG Electronics, in turn, will offer system consulting, an automation apparatus and digital transformation solutions that incorporate artificial intelligence and big data, leveraging innovations from LG Smart Park in Changwon, South Gyeongsang Province, and its counterpart Tennessee plant in the US.

Benefiting from the technological acumen of two “lighthouse factories” acclaimed by the World Economic Forum in 2021 and 2022, the companies will engage in deep collaboration to foster innovation within the smart factory domain. Lighthouse factories are those that have implemented Industry 4.0 technology to drastically improve operational efficiency.

Allying with industry players such as Microsoft and PTC, LG and LS aim to deploy their collective expertise to deliver competitive smart factory and energy-efficient solutions on a global scale. The strategy endeavors to leverage software and hardware solutions, while enhancing sales through targeted promotional initiatives on both domestic and international fronts.

"At a time when industrial DX (design transformation) is accelerating through the convergence of IT and OT (operational technology), collaboration with global top partners in various fields is essential," said Cho Wook-dong, senior vice president of LS Electric, on the partnership.

“The MOU enables us to provide comprehensive solutions beyond our inherent capabilities, aiming to establish a 'Total Factory Offering' system across the entire factory domain," added Song Si-yong, vice president at LG Electronics.

Meanwhile, the two companies have maintained collaboration since 2019, engaging in production innovation of low-voltage equipment lines, enhancing the exterior quality of transformers and constructing advanced incoming panel factories.