LG Electronics is struggling in the global smartphone market. LG Mobile Communication losses for the 18th consecutive quarter. Its global smartphone market share has also been on a steady decline. It seems that Chinese manufacturers such as Oppo, Vivo, Xiaomi, and Realme are also losing ground.
According to the report released on Oct. 31 by market research firm Counterpoint Research, LG Electronics’ portion of global smartphone shipments by brand stood at 2 percent in the third quarter of 2019. It was down 0.8% from the same period last year. By ranking ninth, it managed to keep the top 10 spots.
Chinese Smartphone manufacturers and the forever rival, Samsung outperformed LG Electronics. Five Chinese manufacturers — Huawei, Oppo, Xiaomi, Vivo and Realmi — took the top spot, nothing much different than the last quarter. In particular, Realme is showing significant growth from 0.3% of the same period last year to 2.7% this year. This is due to the fact that it has captured emerging markets such as India and China by using competitive prices.
LG Mobile Communication admits the loss
The slump in LG Electronics’ Smartphone business was also confirmed in its announcement of its third-quarter earnings in 2019. MC Business Headquarters had reduced its deficit compared to the 2nd quarter of 2019 but failed to convert surplus and recorded loss for the 18th consecutive quarter.
LG Electronics is going to take advantage of 5G Smartphones. It is also going to introduce a dual-screen 5G Smartphone called ‘V50 ThinQ’ in North American markets on the 1st. LG Electronics’ Smartphones are popular in North American markets.
It is also planning to expand ODM (Order Development Production) from low-priced models to low-priced models. Its goal is to secure price competitiveness and increase sales volume by improving its business cost structure. With this opportunity, it will expand investment in R&D to achieve a virtuous cycle such as production of premium products. LG Electronics announced the plan through a conference call.
However, it is too early to expect immediate results. The outlook for the fourth quarter of 2019 is not bright, which analysts say should be seen in the first half of 2020. Stock industries are predicting that their losses will expand due to increased marketing costs due to release of new V50 ThinQ and preemptive investments targeting 5G markets in 2020.
