LG Pulls Cheap China Smartphones for Premium Models Focus

LG Electronics Inc. is withdrawing its range of lower-priced smartphones in China as South Korea’s second biggest phone maker tries to revive profit by focusing on premium models that run on fourth generation networks.

LG, which last week started domestic sales of its latest high-end smartphone the G Pro 2, is in talks with three mobile operators in China to expand sales of premium devices, Park Jong Seok, the head of LG’s mobile-communications division told reporters in Seoul.

The mobile phone maker is boosting the number of its products that run on 4G networks to better compete with Chinese producers including Huawei Technologies Co. and Lenovo Group Ltd. LG wants to raise the profile of its high-end smartphone G series brand, including the 5.2-inch G2 and the 6-inch G Flex with a curved display, according to Park.

“We have the world’s best LTE technology and the China market is shifting toward LTE,” Park said. “We’ve been pulling out all cheap smartphones and decided to closely collaborate with mobile operators in the premium segment.”

Higher marketing costs led LG’s mobile division to a second straight loss in the fourth quarter, posting an operating loss of 43.4 billion won ($40 million) on sales of 3.59 trillion won. The Seoul-based company also plans to increase the number of tablet products and develop a wristwatch smartphone this year, according to Park.

LG maintained its fifth position in the global smartphone market in the fourth quarter with 4.6 percent of shipments, according to researcher IDC. LG was overtaken by Lenovo and Huawei in the third quarter of last year.

Last year, LG boosted phone shipments 24 percent to 70 million units from 56.6 million units in 2012, according to IDC.

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