LG Innotek has officially commenced operations at its newly completed V3 factory in Haiphong, Vietnam, effectively doubling its camera module production capacity. The expansion is part of the company's strategy to enhance its global leadership in the smartphone camera market amid intense competition from Chinese manufacturers.
Massive facility expansion drives production goals
The V3 facility spans approximately 150,000 square meters, equivalent to roughly 20 football fields. South Korean media outlets News1 and ET News report that the new plant significantly enhances LG Innotek's manufacturing capabilities, doubling its previous output. This large-scale expansion aligns with the company's earlier announcement in July 2023 to invest around KRW1.3trillion (US$930.64 million) in its Vietnamese production bases through December 2025.
Dual-core strategy balances innovation and production
LG Innotek's expansion strategy includes a dual-core production location framework, with significant investments in both Vietnam and South Korea to counteract pricing pressures from Chinese competitors. In March 2025, the company signed an investment agreement of KRW600billion with Gumi City in North Gyeongsang Province, South Korea, planning new equipment installations at its Gumi plant by the end of 2026. This site will focus on manufacturing high-value-added camera modules and related products, emphasizing advanced technologies and research and development.
The company's dual-core strategy designates the Gumi plant as the "optical solution mother factory," where technology development and advanced camera modules for new smartphone models are prioritized. Meanwhile, the Paju plant in South Korea specializes in high-end products such as camera modules with 3D sensing capabilities. The Vietnam operation serves as the core production base for standardized camera modules. Industry insiders predict that LG Innotek aims to boost camera module output at its Vietnam facilities to 70–80% of its total global production within two to three years, likely achieving this target ahead of schedule.
AI integration streamlines operations and cuts costs
Additionally, LG Innotek is focusing on internalizing key components and utilizing artificial intelligence (AI) to streamline production and improve cost efficiency. The company has applied AI in raw material inspection processes, reducing the time required for defect cause analysis by up to 90%. AI-driven process optimization has also shortened processing times from 72 hours to under six hours, enhancing overall operational efficiency.
Moon Hyuk-soo, CEO of LG Innotek, emphasized that the completion and start of operations at the V3 plant will contribute to gradual profitability improvements in the camera module business. The company intends to expand advanced technology proposals to its customers while continuing to internalize critical components, reinforcing its position as a global leader in camera module manufacturing.
Article translated by Jingyue Hsiao and edited by Jerry Chen
