LG Electronics India Ltd (LG) is scouting for OEM tie-ups in the southern region for its consumer electronics, home appliances and computer peripherals products.
"The south is a major and growing market for LG products. But we don't have our own manufacturing base in the region. Hence we are looking at local OEMs for suitable tie-ups," LG's general manager, corporate logistics, S N Rai, told Business Standard here today.
Rai said he had already held discussions with some OEM firms at Hyderabad and some other cities in the south and "we hope to formalise arrangements soon".
LG has a tie-up with the Voltas refrigerators here for the manufacture of the conventional direct cooling refrigerators in the factory earlier owned by the Hyderabad Allwyn Ltd. They are trying for such tie-up for the television, washing machines and other fast moving products.
Rai said the modern manufacturing facility LG has set up in Greater Noida has capability to churn out seven lakh colour television sets, 2.50 lakh refrigerators, 2.50 lakh washing machines, 1 lakh air-conditioners and 55,000 microwave ovens per annum.
He said while Voltas is manufacturing for LG the direct cooling refrigerators, the current focus of the company is on frost-free refrigerators, especially the below 300 litres capacity ones which the middle class require.
Studies had indicated that 55 percent of the demand for the frost-free segment of the Indian refrigerator industry is for the medium sized 230 to 250 litres capacity units.
"This will be LG's focus area in 2002", he said and added that two variants of 230 and 250 litres will start coming out of the Noida production lines by March 15, 2002. A new production line with an investment of $ 10 million has been set for the purpose.
LG's product group head for frost-free refrigerators, Anil Arora, earlier told mediapersons that LG will grow to become India's largest frost-free refrigerator brand in 2002, capturing 38 percent of the market as against 17 percent of the market in 2001.
The company has planned a slew of launches, in all 10 new models, this year, taking the choice available with the consumer to 22 variations, to address the needs of all the consumers in the premium, middle and lower segments.
With the launch of the 230-250 litres capacity frost-free refrigerators from April this year LG will shift its market focus from the current urban consumers to semi-urban and even rural markets.
Towards this end, the Company is broadbasing its marketing set up -- increasing the branches to 22 and opening 53 area offices and 83 territory offices to expand accessibility.
Arora also launched a new DIOS (digital intelligent optimum silence) side by side door frost-free refrigerator targeted at the high-end consumers. Available in three capacities -- 610, 710 and 810 litres, the price of these refrigerators range between Rs 63,000 and Rs 1.20 lakh.
LG Branch Manager Prashant K Das explained the salient features of the new products.
