Brothers up in arms for corporate revival
By Kim Yoo-chul
Leaders of LG Group are talking about making the conglomerate lean and mean.
Some affiliates, such as LG Chem, are already tough nuts to crack, with its competitiveness surpassing or being on par with its counterparts in Samsung Group.
Of course, LG Electronics is an exception but with Koo Bon-joon, the younger brother of the group leader Koo Bon-moo, in charge, the situation facing the LG flagship, which has suffered from a late start in smartphones, appears to be changing very fast.
Shares of LG Electronics rose more than 20 percent after Bon-joon was appointed to be in charge, with analysts predicting a
Bon-joon appears to be realistic about the firm's circumstance.
"The situation is truly bad. We lost our DNA for survival," said the electronics giant CEO.
"I will see to it that our quality of product will be enhanced and research & development will receive priority."
Moreover, Koo admitted that LG was behind in reading a transition from feature phones to smartphones.
LG's new corporate slogan is "fast, strong and smart."
The slogan is similar to those of LG Chem., the group’s success story, under Kim Bahn-suk, one of the few heads of LG affiliates who see their firms on par with those of Samsung Group.
Another LG success story is LG Display, also competent enough to go head to head with its Samsung counterpart, although it faces less bright prospects for this year.
Koo's emphasis on R&D and products does make sense considering the steady rises of LG Display and LG Chem ― the LG Group’s flat-screen and component affiliates.
Led by CEO Kwon Young-soo, LG Display has been fully set to battle with Samsung Electronics in the highly-lucrative 3D panel market as its most recently developed 3D glasses using film patterned retarder (FPR) technology are cheaper, lighter and don't require batteries.
LG Chem has lured eight top automakers as its clients, outclassing its biggest rival Samsung SDI in terms of customer numbers.
An LG spokesman, Oh Sea-chun, declined to comment on this issue.
``Collaboration between the group’s key affiliates has been strengthening since Koo took office, giving the electronics unit an additional momentum for a turnaround,’’ an LG official said.
Bon-joon has also asked LG Innotek and LG Display to develop competitive products.
Kwon Young-soo vowed to give his all to LG Electronics, while LG’s TV chief Kwon Hee-won said he was seeing positive changes in products, human resources and organizational structures.
LG has decided to return to the world’s biggest telecom exhibition, the World Mobile Congress, in Barcelona, Spain, next month for the first time in two years and officials say LG’s strategic smartphones and its tablet PC will be unveiled.
LG is planning to invest more than $300 million for the construction of its new manufacturing plant in Brazil to produce home appliances.
“LG hopes to get another chance that it can’t afford to lose’’ said another LG executive.