Korean cable maker accelerates US expansion to mitigate tariff risks, bolster supply chain
LS Cable & System announced Tuesday that it will invest $681 million to construct the largest submarine cable manufacturing plant in the United States, marking the first such investment by a South Korean cable company and the second major Korean initiative following the launch of the second Donald Trump administration.
The new facility will be built by LS GreenLink, the company's US subsidiary, in Chesapeake, Virginia. Construction is scheduled for completion by the third quarter of 2027, with mass production expected to begin in the first quarter of 2028.
The groundbreaking ceremony, held Monday in Chesapeake, was attended by key executives and government officials, including Chesapeake Mayor Rick West, LS Cable & System CEO and President Koo Bon-kyu, and Virginia Governor Glenn Youngkin. During the event, West, a Republican, announced that the access road to the plant site would be named “1 LS Way,” noting that while the city council rarely changes street names, it approved the change in recognition of the largest investment in Chesapeake’s history.
LS Cable highlighted that the new production base will feature a 201-meter Vertical Continuous Vulcanizing (VCV) tower — a critical structure for manufacturing high-voltage submarine power cables — as well as a dedicated port facility. This setup will enable fully integrated operations, from production to transport and supply of High Voltage Direct Current (HVDC) submarine cables.
The VCV tower is expected to become the tallest structure in Virginia and the tallest industrial facility along the eastern seaboard between Philadelphia and Charlotte. The project is anticipated to create more than 330 new jobs in the local community.
To support the project, LS Cable secured $99 million in federal subsidies under the Inflation Reduction Act, which incentivizes clean energy manufacturing in the US. Along with $48 million in tax incentives from the state of Virginia, total US government support amounts to $147 million — the largest such package received by any global cable manufacturer to date.
This large-scale investment comes in the context of Trump’s impending 25 percent reciprocal tariffs on Korean imports, set to take effect after the grace period ends on July 8. Given the limited infrastructure for submarine cable production in the US, LS Cable’s project is expected to bolster the domestic supply chain and mitigate the impact of the new tariffs.
“Having already secured an 18-month supply of submarine cables for export to Europe, we anticipate growing demand driven by the US AI data center sector, where power needs are projected to reach 32 gigawatts — half of Korea’s annual power consumption — by 2024, and rise to 120 gigawatts by 2030,” said LS GreenLink President Kim Ki-soo.
Through this project, LS Cable aims to establish a central hub for its global submarine cable business, spanning the US, Europe and the Middle East. The Virginia plant is also expected to enhance access to the European market, with logistics costs from the US roughly 20 percent lower than from Korea.
The company also expects strategic synergies from collaboration with affiliates LS Marine Solution and LS Eco Energy.
hyejin2@heraldcorp.com
