Can LG Beat Moto? Perhaps Next Time
By Kim Yoo-chul
Staff Reporter
LG Electronics wrongly thought it could surge ahead of Motorola as the world's No. 3 mobile phone maker.
Motorola said Friday that it shipped 28.1 million units between April and June to maintain its lead over LG through higher sales of high-end models. Over the same period, LG sold 27.7 million phones.
Industry experts and LG had expected the Korean firm to beat Motorola in shipments in the second quarter, as Motorola had steadily lost its lead due to a lack of phones with high-speed Web links after its once popular Razr phone.
Skott Ahn, chief of LG’s mobile division, told The Korea Times earlier that he was positive on overcoming Motorola in the second quarter, riding on Motorola’s woes to raise sales of LG phones in North and South America, Europe and Asia.
Experts say LG will find it tough to capture the No. 3 position in the global mobile phone market, as Motorola will introduce new advanced phones in its traditional home turf. Even industry leader Nokia is known to have cut prices on many phones up to 10 percent in late July, cornering LG to join the price cut war.
"Motorola is banking on new phones for growth, including a new touch-screen device for North America and other regions this year," Motorola CEO Greg Brown said. "Half of Motorola's new phone portfolio in 2009 will be high-speed phones and it allows us to play in a marketplace where we've had a challenged portfolio."
But LG staffers say their company can still overtake Motorola over the next few months by shipments, citing fairly aggressive marketing of LG’s touch phones in the crucial North American and European markets.
LG's phone shipments in the second quarter rose 46 percent year-on-year, while those of Motorola decreased 21 percent. LG earned 540 billion won in operating profit. Motorola lost some 350 billion won.
"Motorola hit bottom even though the improvement wasn't much. It will be a strong challenge for us to beat the U.S. maker as Motorola will launch 50 new touch phones this year to better compete with Apple’s iPhone," an LG spokesman said.
In the second quarter, Nokia was tops with sales of 122 million units, followed by Samsung Electronics with 46 million. Motorola, LG and Sony-Ericsson rounded out the top five.