LG mulls plant for front loading washing machines in India

Launches Direct Drive technology in washing machines

LG Electronics India Private Limited, the wholly-owned subsidiary of LG Electronics, South Korea, is planning to set up a new facility to manufacture fully automatic front loading washing machines in India.

Currently, the company manufactures fully automatic top loading and semi-automatic washing machines at Noida.

Niladri Datta, product group head (washing machines), LG Electronics India, said, "We are planning to set up a new manufacturing facility for front loading washing machines in India, which are currently imported from Korea. We are in the process of finalising the location for setting up the new LG facility. It will be either at Noida or Ranjangaon near Pune. The exact amount of investment being made for the same is being worked out".

He said, at present, the company has an installed capacity to manufacture 10 lakh washing machines at various locations including Noida. Other than its own plant at Noida, the company is also sourcing from contract manufacturers in the country. The new facility will have a capacity to produce one lakh machines annually, he told Business Standard.

While the company had invested Rs 500 crore till now in India, it was yet to work out how much it would invest in the new manufacturing facility in India, Datta said, adding that it would be operational by 2008.

LG India is one of the fastest growing companies in the country. It reported a turnover of Rs 7,500 crore in 2005 and was targeting Rs 9,000 crore in 2006. Its washing machines division contributes 8 per cent to the total turnover in India.

In 2005, LG sold 4 lakh semi-automatic washing machines, 1.10 lakh fully automatic, of which front loading machines were 30,000. This year, it plans to sell 50,000 front loading washing machines.

LG currently has a market share of 34 per cent in washing machines, both fully automatic and semi-automatic put together, as per ORG data.

The growth in this segment will come from its newly launched range of washing machines equipped with 'Direct Drive' technology, developed and patented by LG.

The highlight of the Direct Drive technology is that unlike conventional washing machines, it integrates the motor, belt and pulley into a single quiet and durable motor, which is attached directly to a drum. This ensures minimum vibration and noise and eliminates the need for belt replacement, according to Datta.

Datta further added that the growth in the company's business would be fuelled by the working couples in urban centres. It aims to sell 5,000 Direct Drive technology washing machines this year.

It is also penetrating deep into semi-urban and rural markets across the country. LG offers 17 models in front loading washing machines that are priced between Rs 20,990 and Rs 79,990.