Haier teams up with Daewoo

By Kim Yoo-chul

Staff reporter

China's consumer electronics giant Haier has formed a united front with Korea's smallest home appliances manufacturer Daewoo Electronics in an effort to provide better after-sales care for customers using Daewoo's network, a senior Haier executive said Friday.

The largest white goods producer on the Chinese mainland is planning to heavily focus on "off-line" sales capitalizing on major local outlets such as Homeplus.

Haier's latest gambit in Korea where Samsung and LG reign comes at a time when consumer spending on electronics-related products has been increasing.

"The business outlook in the Korean market has become better thanks to the faster economic recovery, helping us to implement aggressive marketing strategies for an increased market share," said Philip S. Carmichael, head of Haier's Asia-Pacific operations, during a news conference at the Press Center in downtown Seoul, Friday.

The executive talked to the press during a launch to unveil its 22-inch liquid crystal display (LCD) television sets.

The full-HD TVs will sell through the network of Homeplus outlets with a suggested price of 290,000 won ($285) per unit ― 40 percent lower than models produced by Korean manufacturers.

"The alliance with Daewoo is crucial considering the importance of the Korean market. Haier will send well-trained full-time technicians to boost consumer satisfaction and to improve the quality of our products," he said.

Data from the Euromonitor International has shown that Haier took the top spot in terms of retail volume with a global share of 5.1 percent, last year, following Whirlpool of the United States and LG.

Increased brand awareness

Haier has so far failed to make a big impact in Korea since it started operations in Korea six years ago mostly due to weaker brand recognition and after-sales service channels compared to Samsung Electronics and LG Electronics.

"We've seen an increase of brand awareness since 2004. Haier will further strengthen the lineups of wine-coolers, mini washers and refrigerators," Carmichael said, adding the company was planning to introduce 3D TVs this year, which were exhibited during this year's Consumer Electronics Show (CES).

When asked about sales and profit targets in Korea for this year, he said the Chinese company is trying to boost revenue outside mainland China.

Haier had suffered heavy losses in Korea last year, hit by a global economic downturn.

Haier's Korean representative office declined to give the financial data in 2009 or comment on this year's sales projection.

Carmichael also didn't say whether it use the LCD panels for its new mini TV came from either LG Display or Samsung Electronics. Early this month, Haier Group said it was planning to set up a joint venture with Taiwan's AU Optronics to manufacture LCD TV modules.

Haier produces a wide range of consumer goods, which it sells in 160 countries. It has 13 manufacturing plants overseas.

The number of the group's total employees was 60,000 as of the end of last year. It controls 25.5 percent of the Chinese consumer electronics markets. For 2009, Haier made some $20 billion in global sales.