LG Electronics is gearing up to sell DVD players manufactured in India.
While 90 per cent of the DVD players it currently sells in India are imported from Korea and 10 per cent are made in India, starting July-August, the majority 90 per cent will now be sourced from Calcum, a Parwanoo (Himachal Pradesh) based original equipment manufacturer (OEM), which currently makes 10 per cent of LG’s DVD players.
And it will only be the small 10 per cent that will be imported from Korea.
LG is expected to sign an exclusivity contract with Calcum by which the latter’s complete production will be bought by LG starting from July.
LG India product group head (televisions) CM Singh told FE, "We are expecting to sell more than double the number of DVD players we sold last year. Looking at the increasing volumes, we feel it now makes sense for us to source locally made DVD players."
2003-04 was the year when prices of DVD players took their best ever beating, crashing by about 30-40 per cent.
By 2005, the Consumer Electronics and TV Manufacturers Association (Cetma) says the DVD player market in India will be about 10 million units. Mr Singh is very bullish on the DVD market, and says his division is targeting sales of 1,00,000 DVD players in the May-June period.
To put that in perspective, LG sold 21,000 units in the whole of 2003. "This segment is very volatile. In just one year from now, prices will come down further by about 25-30 per cent, and in six months consumers can expect an entry-level price point of Rs 4,000 from LG."