By Cho Jin-seo
Staff Reporter
LG Electronics became the world's fourth largest mobile phone maker in the first quarter by surging ahead of SonyEricsson for the first time since 2006.
The maker of Viewty and Prada phones now joins the elite group of Nokia, Samsung Electronics and Motorola in the cell phone market. Furthermore, LG sees that it will be able to overcome ailing Motorola in the second half of this year.
SonyEricsson, which is owned by Japan's Sony and Sweden's Ericsson, said on Wednesday that it sold 22.3 million mobile phones between January and March, down from 30.8 million in the previous quarter. Meanwhile, LG Electronics shipped 24.4 million units in the January-March period to steal the fourth position in the global market share.
LG aims to sell 100 million handsets this year, posting 12.5 trillion won ($12.5 billion) in sales and 1 trillion won ($1 billion) in operating profit. Those targets are up by more than 20 percent from last year, which will be enough to put LG in a neck-and-neck race with Motorola, which has lost its vigor since last year.
Motorola sold 27.4 million phones in the first quarter, 3 million more than LG, at an operating loss of $418 million.
``In this trend, we will be able to achieve our annual target comfortably. But we don't put much meaning in the sales volume rankings,'' said LG spokesman Choi Joon-hyuk.
LG's mobile business fell behind Sony Ericsson's in the summer of 2006 when it reported losses for two consecutive quarters. But thanks to strong sales of Viewty, Voyager, Venus and other high-end models, its handset shipment recorded the highest in the first quarter.
It also had a healthy profit margin of 13.9 percent, compared with 6.7 percent at SonyEricsson.
Thanks to the high-flying handset division, LG Electronics' share price rose from the mid-50,000 won level a year ago to over 140,000 won last week, despite the downturn of the stock market. Some stock analysts such as Mirae Asset Securities believe it will touch 200,000 won this year.
Finland's Nokia is the solid leader in the mobile phone industry, accounting for almost 40 percent of the global market. Samsung Electronics, LG's cross-town rival, is a distant runner-up at around 15 percent. Samsung is to announce its quarterly performance report on Friday.
Third-place Motorola is having the most difficult time among major makers. The U.S. company's handset division recorded $1.2 billion in accumulated losses last year, and is laying off workers all over the world ahead of the planned spin-off of the division next year.