Demand For LG Appliances Booming
Demand for LG appliances is booming the only problem is being able to get one’s hands on stock with some Australian customers told they have to wait six months.
The South Korean Companies appliances are today seen as being a premium appliance offering alongside the likes of Miele who are struggling to hold onto sales in Australia due to excessive pricing for the German Companies products.
According to their latest financials released late last week, LG raked in $A8.5b in global sales of kitchen appliances, air conditioners and vacuum cleaners and other appliances, and an operating profit of A$773m this was up 32.1 percent during the same period last year.
LG who are pushing further into the premium end of the appliance market is also witnessing sales of their Signature range of appliances grow in Australia after the Company launched a Signature wine fridge last year.
Some analysts believe that the South Korean Company is on a path that could see them dominate the global appliances market, outstripping renowned rivals from Europe, China and the USA.
The Company first to introduce their appliance range which included a fridge and a washing machine in 1965 and 1969, in Korea.
Recently sales improved in Australia and most other global markets where they compete during the April-June period the best quarter ever for LG, the firm said in a press release.
If current trends continue throughout the year, LG will beat Whirlpool in annual sales too, officially taking the crown of the world’s top home appliance maker.
Analysts claim that LG could reach 70 trillion won in sales and 4.5 trillion won in operating profit by the end of the year, up about 11 percent and 43 percent, respectively, from last year.
Industry watchers attribute the growth of LG’s home appliance business in most markets to the popularity of the “space interior” home appliances line-up of the LG Object Collection which has still not been launched in Australia.
The global launch of the Object brand into key markets appears to have propelled LG to the market’s top position, boosting overseas sales significantly observers claim.
What LG is finding is that an Object owner tends to purchase more Object items or consider a package purchase of multiple LG appliances that tie into the overall look of a kitchen.
A booming housing market in markets such as Australia and the USA has also helped LG’s appliance business.
LG said that they are is operating its home appliance factories is at full capacity to respond to the rising demand.
Also in April, the company invested an additional $20.5 million in its washing machine plant in the US state of Tennessee to ramp up production in the USA.
The Tennessee factory currently has a capacity of producing more than 1.2 million washing machines a year.
LG’s profitability from the home appliance business took the Korean market by surprise especially as they beat out domestic archrival Samsung Electronics claim analysts.