LG Electronics India Private Ltd will be investing $250 million in India by 2010. MD Kwang-Ro Kim said, out of the fresh investments, about $60 million would be made in manufacturing GSM mobile phones in the country, adding: “By 2010 we will be producing 20 million units in India and 50% of this would be for exports.” The company has already invested $160 million in the country.
These mobile phones will be manufactured at the second plant coming up at it’s facility in MIDC’s five star industrial estate at Ranjangaon, 50 kms from Pune. The plant is expected to start production in 2005. The first plant inaugurated on Wednesday by LG chairman Bon Moo Koo has now become operational. The ceremony for the second plant was also carried out by him. The plant had been set up in a record time of 15 months. This will bring a lot of logistical benefits for addressing markets in the West and South. LG also plans to export 50% of the production. It has invested Rs 200 crore in the first phase while total investments are expected to be about Rs 600 crore totally in three phases. The installed capacity of the new LG factory is a million units and it will manufacture CTVs, refrigerators, ACs, microwave ovens, washing machines and monitors. Premium products such as projection TVs, Plasma TV, new concept refrigerators and plasma air-conditioners will also be manufactured here. This will take LG India’s total capacity to 2.5 million units.
The LG chairman said that India was a very big market for the LG Group and he was particularly impressed with the people and the level of skill available here especially engineers, adding, “We will be hiring more in India.”
LG vice-chairman SS Kim said LG India was special for the Group among its global subsidiaries because it was going to play a significant role in exports. The $16.9 billion LG Group is aspiring to be among the top three in the world in electronics and telecommunications.
The Indian operations through LG India is expected to contribute around 10% to the chaebol’s total turnover from the present 5%. India will also be a major export hub for LG worldwide and exports will account for $3 billion of the revnues (30% of the total turnover) by the year 2010.