Wednesday, February 13, 2008

LG looking to increase on outsourcing

Source : Click here

South Korea's LG Electronics plans to outsource some more handset production in 2008 due to the rapid sales growth that the company is going through.
"Starting this year, we will take outsourcing more seriously", Chang Ma, LG's vice president for marketing strategy said.

Like its rival Samsung Electronics, LG has retained a vast share of its production, according to Reuters. Some of the European and US based cell phone makers have outsourced more than half of their production to EMS Companies such as Flextronics, Foxconn and Elcoteq, Reuters reports. According to Mr. Ma the company has no intention to enter the ultra low-end of the market for phones which today sells for less than €30.

DisplaySearch also reported strong consumer demand for 1080p LCD TV products throughout 2007 contributed to a strong year overall, despite sluggish consumer take-up in the final weeks of 2007. Demand for notebook PC displays was also strong in 2007. Annual shipments for portable computer applications rose 43% in 2007, and Q4'07 demand grew 45% Y/Y for a strong finish.

Some panels designed for PC monitor applications found their way into the LCD TV market, so annual growth of 31% for monitor panels overstates the actual demand for desktop displays. DisplaySearch expects buyers will prefer notebook PC products over desktop PC products for several years to come. Demand for flat-screen TV and portable PC products worldwide drove total large-area TFT LCD panel (10" or larger) shipment growth of 4% Q/Q and 40% Y/Y in Q4'07. Total large-area LCD shipments rose 40% in 2007.

Samsung Electronics captured the greatest share of TV panel revenues with sales of $8.6B in 2007 according to DisplaySearch findings. This 26% revenue share and was followed by LG.Philips LCD with a 22% sales share of TV panels. AU Optronics finished strong and increased its TV panel sales 126% Y/Y in Q4'07. For the year, AU Optronics had a 19% sales share. These three suppliers shipped 80% of all notebook PC panels in 2007, which DisplaySearch believes improved their operating performance.