Korean Premium Electronic Home Appliances Dominate US and Europe

High quality (Premium) Korean electronic home appliances such as drum washing machines and two-door refrigerators are very sensational in US, Europe, etc that are the originators of large-sized electronic goods.

At 15th, According to electronic home appliance industry, premium electronic goods of domestic companies defeated foreign goods in domestic market, and increase the share in foreign market.

It was impossible to image this reversal situation a few years ago when US two-door refrigerators and European drum washing machines dominated. For last a few years, domestic companies has competed against foreign companies in premium market and accumulated know-how, and they began to develop foreign markets with confidence from this year.

▽ Nothing venture, nothing have= domestic companies such as Samsung Electronics, LG Electronics, etc began to focus on foreign premium market to extend the market.

Premium goods are more profitable in foreign market than domestic market and the extension of domestic market is limited. Domestic market for two leaved door refrigerators is estimated only 70,000 units size, but 2.7 million units size in US market.

Lee Sang-wan, Senior Manager for Refrigerator Operation of LG Electronics commented “US and Europe are original market for premium home electronic goods. So they are very profitable and our first target.”

▽ Korean premium home electronic goods surprised the originator= LG Electronics introduced Internet Dios refrigerator to US market and appeared as dark horse in North America Market for two leaved door refrigerators. Internet Dio of LG Electronics installed Internet function is sold at 7,999 dollars and higher three times than the best two leaved door refrigerators of GE (2,499 dollars). LG Electronics will manufacture 600,000 units of refrigerators annually in LGEMM in Monterrey located north of Mexico.

Samsung Electronics will export large-sized projection Television to European market, LG Electronics will export PDP television more than 40 inches to Japan that is the originator of large-sized television.

▽ Competing with technology= LG Electronics has maintained more than 100% growth rate since it introduce drum washing machine in 1998. The secret of success is frontal competition with technology accumulated.

Trom, drum washing machine of LG Electronics, has maintained high quality brand by continual technological innovation even if recognized less than European AGE, Mille, Bosch, etc. LG reduced noise and vibration of washing tank by applying direct driving system. It was graded AAA by Energy Saving Assessment by EU member nations. AAA is awarded only for top 10%. So it is sold higher price than European goods by 10 %.

In case of Zippel of Samsung, there are two compressors in a refrigerator. Due to its high quality function, it maintains top position with sharing 70% of two-door refrigerators in UK.

Tae-Han Kim freewill@donga.com