LG expects TV business to turn profitable in Q3

By Kim Yoo-chul

Kwon Bong-seok

BERLIN, Germany — A senior LG Electronics executive said Sunday (KST) that its television business will turn profitable from the third quarter of this year as the world’s No. 2 TV manufacturer expects its latest models introduced during the second quarter will help boost its sales and profits.

“LG’s TV business was in trouble for the first six months of the year. However, our TV business will turn profitable from the third quarter of the year thanks to the gradual recovery in consumer demand in key markets,” Kwon Bong-seok, head of LG Electronics’ home entertainment division, said in a news conference on the sidelines of the IFA fair.

The executive admitted that the strengthening U.S. dollar and the huge slump in the value of the Russian currency made a negative impact on its core business.

In an attempt to regain the market share that it lost to Chinese rivals, the executive said LG plans to release its advanced flat-screen LCD TV using quantum dot tech.

“The launch of LG’s new TV using quantum dot tech doesn’t necessarily mean LG’s OLED strategy has been changed. OLED TV is premium. LG will push for that. However, the company also needs to respond to growing demand from consumers for affordable models with enhanced viewing technology,” Kwon told reporters.

LG Electronics installed a number of large-sized OLED TVs at its booth during the fair, sending a message that it’s committed to becoming the global leader in the OELD TV business, which is still new but highly lucrative.

LG expects the demand for premium TVs to grow to four million units by next year with the LG Group’s consumer products affiliate hoping to take more than 20 percent of the global market by selling more than 1 million units.

“More Japanese and leading Chinese TV manufacturers are joining with LG Electronics for OLED TVs. Panasonic, one of the major TV manufacturers in Japan, unveiled its 4K OLED TV during the fair. LG aims to expand its OLED alliance,” said the executive.

LG plans to implement an aggressive pricing strategy to boost the industry.

“In the latter half, an OLED TV will cost 40 percent more than an LCD TV with the same size. By 2016, consumers are expected to pay 20 percent more to purchase an OLED TV than LCD TV with the same size. This will help the entire industry see further external growth as consumers purchase premium TVs paying less than previous years,” said the executive.

Kwon said its in-house W-RGB OLED technology has been authorized by international standard-setting bodies.

“BestBuy, the biggest distributor in the United States, also verified LG’s W-RGB OLED technology. There’s no question about the validity of our technology,” he said.

In a question over rising concerns about short lifespan and heat-related issues in OLED TVs, the executive said new LG OLED TVs will have more lifespan and free from heat-related issues thanks to the development of key materials to be used in those pricey TVs.

OLED TVs don’t require bulky backlight, making the sets more stylish, light and save energy consumption.