LG Expands Chiller Production To Meet AI Data Centre Cooling Demand

LG Electronics is boosting its global chiller production capacity to respond to the fast-growing demand for cooling systems used in artificial intelligence data centres, and the company will build a new air-cooled chiller production base in Virginia, USA, and expand production capacity at existing production bases in Changwon and Pyeongtaek, South Korea.

Key Highlights

• LG will establish a new chiller factory in Virginia, with production scheduled to begin in the first half of 2027.

• Production capacity will also increase at LG’s Changwon and Pyeongtaek facilities in South Korea.

• The company is expanding its AI data centre portfolio from chillers to Direct-to-Chip liquid cooling and integrated infrastructure solutions.

LG Electronics to expand chiller production across three factories

LG Electronics said the new US facility will be located in Windsor, Virginia, and will cover 30,000 square metres of gross floor area on a 170,000-square-metre site. The plant will manufacture air-cooled chillers designed for AI data centres, with production expected to start during the first half of 2027.

The investment comes as AI adoption drives demand for high-performance computing infrastructure, and AI data centres require effective heat management because increasingly powerful computing systems generate substantial amounts of heat during operation.

According to LG, more than half of the world's AI data centres are located in North America, making the region an important market for its cooling technologies. Virginia also has a significant concentration of data centres operated by major technology companies. Local manufacturing is expected to help LG establish a more responsive supply system for customers in North America.

South Korean plants to increase air-cooled chiller capacity

Alongside the Virginia project, LG is expanding air-cooled chiller production lines at its Changwon and Pyeongtaek facilities in South Korea. The firm is rolling out a conveyor-based production system to improve manufacturing efficiency for mass production.

The system moves products through various stages of the manufacturing process on a single conveyor, enabling the streamlining of the production process as demand increases. LG said the combined investment across the new US facility and the two Korean factories totals KRW 150 billion, equivalent to roughly ₹1,060 crore at the October 2, 2026 reference exchange rate.

The expanded manufacturing footprint is intended to strengthen LG's ability to supply air-cooled chillers as data centre construction accelerates across major technology markets.

LG advances Chip-to-Chiller cooling strategy for AI infrastructure

LG is also expanding beyond conventional chiller systems through its broader Chip-to-Chiller strategy. Its portfolio includes chillers, Coolant Distribution Units and cold plates that can absorb heat directly from semiconductor chips.

The company is developing Direct-to-Chip liquid cooling alongside existing air-cooling technologies. In this approach, coolant circulates through cold plates positioned close to chips, helping manage the thermal loads generated by high-performance computing systems.

LG cited Omdia projections showing global data centre capacity rising from 226 GW in 2026 to 420 GW by 2030. About 60% of the additional capacity is expected to be concentrated in North America.

The company is also pursuing AI data centre projects through relationships with hyperscalers and major technology companies. In Asia, LG is combining HVAC capabilities with battery solutions and data centre design, construction and operational expertise from other LG affiliates under its “One LG” approach.

LG said the strategy is also being applied to a hyperscale AI data centre project for Sinar Mas Group in Jakarta, Indonesia. James Lee, president of the LG Eco Solution Company, said the company would continue strengthening cooling technologies and production capacity to address growing AI data centre demand.