LG Electronics Keeps Nam as Chief ExecutiveKevin Cho
LG Electronics Inc., the world's third-largest mobile-phone maker, named Nam Yong as chief executive officer for a second term as the company seeks to extend its market-share gains in handsets and televisions.
Nam, who has headed the Seoul-based company since 2007, will remain as the CEO, Judy Pae, a spokeswoman at LG said by telephone today.
Nam, 61, faces the challenge of helping LG catch up with smartphone makers such as Apple Inc. (AAPL) and Research In Motion Ltd. (RIMM) in the industry's fastest-growing segment after falling behind in new model launches. While LG overtook Motorola Inc. (MOT) and Sony Ericsson Mobile Communications Ltd. last year in the overall wireless market, it failed to rank in the top five in sales of smart phones, handsets that run computer-like applications.
"We now believe LG is losing its competitive edge in the handset business due to the lack of an adequate smartphone line-up, slowing the overall business momentum," James Kim, a Hong Kong-based analyst at Nomura Holdings Inc., wrote in a report last month.
Global smartphone shipments rose 12.8 percent in the third quarter from a year earlier as total handset sales increased 0.1 percent, researcher Gartner Inc. said last month. Nokia Oyj was the biggest smartphone maker with a 39.3 percent share in the period, followed by Research In Motion's 20.8 percent and Apple's 17.1 percent, according to Gartner.
Smartphone MarketStill, LG is expected to increase its smartphone market share next year because of its ability to develop competitive models and close relationships with wireless operators, according to Kim Woon Ho, an analyst at Prudential Investment & Securities Co. in Seoul. "The concern about LG's handset business seems excessive compared with the company's competence," Kim wrote in a report last week. "The number of its models is increasing."
LG said in October it plans to introduce more than 15 smartphone models next year compared with six to seven in 2009 and is aiming for shipments of 4 million to 5 million smartphones in 2010.
LG will move its solar business under the air conditioner division and create a customer relationship unit from January, the company said in a statement today.
The company in October reported third-quarter profit that beat analysts' estimates, driven by record shipments of LCD TVs and higher sales of appliances. The company this year surpassed Sony Corp. as the world's second-largest liquid-crystal-display TV maker as the company offered models with wireless and energy-saving features.
"The company will likely increase its TV market share in 2010 because of higher brand recognition and after securing new distribution channels," according to Prudential's Kim.
LG Electronics has gained 56 percent this year in Seoul trading, outperforming the benchmark Kospi stock index's 47 percent advance.