LG Leverages Industry Leadership By Launching New Air Conditioning Company
Johannesburg, January 6, 2009 – LG Electronics, the world’s leading air conditioner manufacturer, announced its vision and business strategy for the challenging year ahead at a press conference held yesterday in Seoul, Korea.
LG has established the LG Air Conditioning Company. The company forms a completely separate business unit to Digital Appliances or any other business unit within LG Electronics. The LG Company will incorporate global heating, ventilating and air-conditioning (HVAC).
LG’s Air Conditioning Company will focus exclusively on commercial and residential air conditioning and businesses solutions, including home networking (HomNet) and building management solutions (BMS).
“Our new organisation is better positioned to compete in the global HVAC market and will allow us to better serve our customers,” said Hwan-yong Nho, CEO of LG Air Conditioning Company. “We expect LG Air Conditioning to be a core growth engine for LG Electronics in the years ahead as we continue to expand the business and capture more market share.”
The formation of a separate air conditioning unit will help LG expand beyond the residential and commercial business to be a bigger player in the industrial and specialised markets, providing total HVAC packages optimised for both home and work environments. The Air Conditioning Compressor Business Team, now under the new Air Conditioning Company, is expected to play a key role in the new integrated company.
The company will continue to fine tune its organisation to better respond to the rapidly changing air conditioning market. Along with this, LG will seek out additional opportunities for mutually beneficial collaboration between units within the company while increasing its focus on building management solutions, home networking and renewable energy.
Despite the global economic downturn that emerged in the second half of 2008, sales of LG’s residential air conditioners topped USD 5 billion last year, a record for the company. Although 2008 sales figures for all manufacturers have not been released yet, LG expects to be the global air conditioner sales leader for the ninth consecutive year. LG also became the first air conditioning company to sell 100 million units cumulatively, which averages out to approximately 4.8 air conditioners sold per minute since 1968 when the first unit rolled off the assembly line in Korea.
As part of its overall strategy, LG Air Conditioning Company will also strengthen its international marketing capabilities with six Regional Business Leaders to oversee Europe, CIS, the Middle East, Asia, Central and South America and China. Product Business Leaders will be individually accountable for incorporating more consumer research during the product development phase and maximising efficiencies at every step from supply chain management to production.