Invest KOREA

According to Pulse by Maeil Business News Korea,

Long gone are the days when Korean brands used to be considered cheaper options to Japanese appliances as two Korean household electronics names Samsung Electronics and LG Electronics now dominate the global premium market.

Since the release of Twin Wash, a washing machine that pairs a regular front-loader with a second mini-washer built into the pedestal below, LG’s share in the market for premium washing machines whose average selling price is at $900 or higher soared to 34.2 percent in the first quarter this year from 23.2 percent in the previous quarter.

“Although the washer fetches from $2,500 for a top-end model to $5,000 when paired with a drier, it is so popular in the US market that supply is barely keeping up with demand,” said LG Electronics USA’s home appliances department manager.

The brisk sales of the premium products have also boosted profitability. Operating profit margin of LG’s home appliance and air solution (H&A) division in the first quarter was 9.7 percent, unusually high in the consumer electronics industry, and it is likely to exceed 10 percent in the second quarter, according to market observers.

The top-shelf for premium TVs is reserved entirely for Korean brands.

Samsung and LG command a combined share of more than 70 percent of high-end TV market. Their quantum-dot SUHD TV and OLED TV are unrivaled in China while most Chinese TV makers are focusing on low-end TVs.

According to market research firm IHS Inc., the market share of TVs with a screen larger than 50 inches went up 4 percentage points to 21.8 percent in the first half of this year from 17.8 percent in the same period last year, while demand for TVs with a screen smaller than 40 inches slipped 7 percent over the cited period. The market for premium TVs whose prices are higher than $2,500 per unit is expanding even when the entire TV market is shrinking.

With 4K UHD TVs that boast four times clearer picture quality than the Full HD counterparts, Samsung and LG ranked first and second with a respective share of 31.8 percent and 13.4 percent in the premium UHD TV market. UHD TVs are three times more lucrative than Full HD TVs. Sales of Samsung’s SUHD TV are increasing in the global market despite its high cost of exceeding $3,000 per unit.

By Song Sung-hoon and Lee Seung-hoon

Copyrights Pulse by Maeil Business News Korea. All Rights Reserved.

Source: Pulse by Maeil Business News Korea (Jul. 1, 2016)