LG Electronics’ hugely successful air conditioning operation, which has held the world number one ranking since 2000, has been spun off from the company’s other home appliance businesses to its own independent division, LG Air Conditioning Company.
LG AC has broken sales records every year through constant innovation in manufacturing, R&D and marketing. The company secured its global number one position by selling 4.1 million units in 2000, and proceeding to top that figure annually: more than 15 million units were sold in 2007 and 2008 respectively. Globally, one out of every five air conditioners sold is made by LG.
Previously focused on the consumer market, LG AC is now broadening its horizons into the B2B sector, and is ready and able to reinforce its presence in the solutions market.
“Our solutions business will grow into a very profitable one in the future and LG aims to grow its sales to more than US$ 4 million by 2010. This will be achieved by constantly developing capabilities and reaching out further in emerging markets,” says Hwan Yong Nho, Chief Executive Officer of LG AC.
Through the recent structural changes, the solutions business is now part of LG AC. The importance of solutions is growing in the B2B market since the number of intelligent buildings is on the rise. Solutions business units can solve problems related to energy consumption control right from the construction phase of a building. LG will create total solutions that can completely control air conditioning, electricity, lighting, security and energy consumption.
Until now, LG has been manufacturing air conditioning hardware through system air conditioning. It is now possible to supply a total integration system including building automation, IT, visual/audio, security, parking control and monitoring. This system benefits residents because it can provide an unprecedented level of comfort to residents and easier building management at lower costs for building owners. Building solutions will help to reduce energy consumption levels and provide security with fire safety functions.
 “In addition, we are now preparing a hotel solution that can provide complete information on the hotel and IT service infrastructure through three areas called U-Guest, U-Facility and U-Lobby. Hotel solutions are the ultimate answer for both hotel guest and staff needs. Hotel guests will be able to use a variety of internal services without any complicated procedures, and hotel staff can control the entire networking system to create ideal surroundings,” says Hwan.
LG has already taken 25% of the total market share, and is taking a leading position in the home networking industry with its HomNet product in the Middle East, with contract values reaching over US$ 8 million.