LG, who slipped behind Huawei Technologies Co last year with a
market share of just under 5 percent, also plans to sell a
smartwatch capable of connecting with rivals' phones, mobile
division president Park Jong-seok told reporters ahead of a
Barcelona trade fair this week.
LG shipped a record 47.7 million smartphones last year, 81 percent
more than a year earlier. But its mobile unit needs more growth to
return to profit, after spending heavily on marketing to narrow the
gap with leaders Samsung Electronics Co and Apple Inc.
The company aims to increase sales through more models appealing to
a wider consumer group, with the Barcelona launch of the G2 Mini — a
lower-priced version of the flagship G2 — coming just weeks after
unveiling a larger-screen G Pro2.
"I expect competition among tier-2 manufacturers for more market
share to become tougher this year, and price competition will also
naturally intensify," Park said.
LG's mobile unit may take a while to become profitable after
swinging to a loss in the three months ended December, as it will
continue to spend heavily this year to promote its high-end models,
Growth of high-end sales in advanced economies is slowing as
smartphones become more widespread, likely bringing overall sales
growth to the market consensus of 10 to 15 percent this year, Park
Overall sales grew 38 percent last year to 1.0 billion smartphones,
showed data from researcher IDC.
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Park also said LG plans to continue reducing its reliance on local
retailers in China where competitors include Lenovo Group, whose
$2.9 billion offer for Google Inc's Motorola handset division could
see it leapfrog LG to global No.3 from No.5.
LG also has to contend with the low-priced phones of other local
makers Huawei, ZTE Corp and Xiaomi.
"In China, we had been pushing for volume growth through investment
in retail channels but this proved to be very costly," said Park.
"We made a strategic change there in late 2012 to focus on high-end
models and aim to grow sales mainly through partnerships with mobile
(Reporting by Miyoung Kim; editing by
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