LG Electronics will be releasing different tiers of 5G smartphones this year depending on the region and demographics, according to the company on Jan. 30. The high-end LG V60 ThinQ will be sold only in the North American and European markets.
“We plan on focusing on different strategies for different regions,” said Shin Jae-suk, team lead at LG Electronics’ Mobile Communication Business during a conference call for its Q4 earnings.
By launching premium phones in the US and Europe where consumers are more receptive of higher prices and telcos prone to more aggressive marketing campaigns, Shin said LG expects to save initial marketing costs as well.
In Korea, LG will focus its next-in-line – the so-called ‘mass premium’ smartphones. “Competition between telecom companies have slowed, and so we believe releasing new 5G products with more affordable price tags would make more sense on our home turf,” said Shin. Most industry watchers believe this indicates the G series.
He added that LG plans to absorb as much 5G demand as it can from markets like US, Japan, Korea and Europe where Apple and Chinese smartphones have relatively smaller access – Apple doesn’t have plans for 5G iPhones until the latter half of this year, while Huawei is suffering from Washington’s sanctions.
LG said ODM models are being avidly considered for the mid and low-tier models. For this year, LGE is looking to go ODM for 20 million of the 34 million handsets it aims to produce. “By 2021, LG is looking for a business turnaround to recover its original market status,” Shin added.
In the fourth quarter of 2019, LG Electronics posted sales of KRW 16.61 trillion to reflect a 1.8% increase and an operating profit of KRW 101.8 billion after growing 34.5% on-year.
Its Home Appliance & Air Solution business had sales of KRW 4.61 trillion, with an operating profit of 122.2 billion. The Home Entertainment business had sales of KRW 4.59 trillion and operating profit of 110 billion. The MC business, on the other hand, recorded sales of KRW 1.32 trillion and an operating loss of KRW 332.2 billion.
For the entire year, LGE posted a 1.6% increase in sales to reach KRW 62.3 trillion and a 9.9% growth in operating profit to KRW 2.43 trillion.
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