SEOUL, 20 October — LG Group, which is dedicated to information and communication, science and Internet technology during the 21st century, has drawn up a plan to spend a whopping $1.7 billion in research & development (R&D) this year.
"This year’s R&D spend is 13 percent more than last year," a top management executive of LG Electronics Inc. told a visiting team of journalists from Saudi Arabia here recently. "Furthermore, the LG Group is pursuing customer-oriented management and a rewarding work environment," Young -Soo Kim, executive vice president at the group’s global communication department, said during a presentation at the group’s Twin Tower complex, a prominent city landmark.
The group, an $81 billion a year company operating around the world with 130,000 employees, consists of 47 affiliated firms in four business fields — chemicals & energy, electronics & telecommunications, finance and service with 300 worldwide offices and subsidiaries. Beginning with LG Chemicals in 1947 and LG Electronics (formerly Goldstar Inc.) in 1958, the group is wedded to the policy of globalization and is pursuing it in letter and spirit. The group is a global company with regional headquarters in key locations around the world and a home office here. "In the coming years, an even greater portion of LG Group’s revenues will be derived from global sales rather than from domestic sales. For instance, about 70 percent of LG Electronics’ 2001 revenue came from international markets. The group will reinforce its global reach in the 21st century," Kim added.
LG Electronics is the biggest company in the group with $13 billion revenue and 53,000 employees working in 72 international subsidiaries across the world. While expanding its business field to the next-generation Internet data center, network service, electricity system and optical cable, LG is rapidly advancing toward achieving its goal of becoming the world digital leader in the electronics and information and telecommunications sectors, according to John Koo, vice chairman & CEO, LG Electronics.
LG Electronics, which continues to forge strategic partnerships with major players like Intel, Microsoft, Sony, Philips and Hitachi for global business, merged with Korea Internet Data Center (KIDC), one of the largest Internet data centers in Asia in 2000. KIDC provides an integrated set of services that delivers a powerful combination of scalability, reliability and cost savings for mission critical data application.
Aside from LG Electronics, another mother company of the group is LG Chem that manufactures a wide range of products from petrochemical goods to high-tech materials for electronics and the most advanced technology required for medicines. LG TeleCom is equipped with the world’s top-notch CDMA technology and LG Innotek is the leader of advanced defense and information & communication technology.
"With successful unique marketing, LG Card won the world’s first global excellence award from Visa. LG Card differentiated successfully with "Lady-only Card" targeted at women and "2030 Card" targeted at young men in their twenties," Kim said, adding that LG Home Shopping is the world’s third largest multimedia shopping company providing a quick full refund service and 24-hour customer counseling. It uses online shopping mall and its sales in interactive home shopping jumped to 10 percent of total sales in 2001. It plans for a further 20 percent increase by 2005.
LG, which claims to be the world’s No. 1 air conditioner maker in terms of the number of units sold, is expected to preserve its position this year too. "We expect to sell 4.9 million units," K.S. Hwang, vice president, Digital Appliance Overseas Sales Marketing Team, said at a reception to the visiting media team after its visit to one of its factories. "For LG, the Middle East market is growing rapidly, especially for its air conditioners," he said. "With slowdown gripping Japan and consequently no fresh R&D investments in that country, Korean manufacturers are benefiting," Kwang remarked in reply to a question.
Going around the factory was a rewarding experience with scores of hands busy assembling three-dimensional air conditioner ‘Art Cool’ and digital clima air-conditioner that contains a plasma filter. The filter removes the microscopic contaminants like dust, house mites, pollen and pet fur to help prevent allergic diseases like asthma. It dissolves the bad odor molecules and circulates the fresh purified air. "The world’s first LG plasma heat exchanger has fin that does not corrode. It saves energy and reduces noise level," Hwang added.
The visiting media team also visited plasma display panel (PDP) plant at LG’s Gumi factory.