November 29, 2024

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LG Electronics CEO Cho Joo-wan speaks at a press briefing held on the sidelines of Consumer Electronics Show 2023 in Las Vegas, Friday. (LG Electronics)

LAS VEGAS -- LG Electronics CEO Cho Joo-wan pinned high hopes on the South Korean tech giant’s burgeoning automotive solutions business, pledging to diversify its business portfolio to tackle challenges this year.

“Our automotive solutions business has made a turnaround 10 years since the launch. Now that the business is on the highway, what is left to do is to step on the accelerator,” Cho said during a press conference held Friday on the sidelines of the CES trade show in Las Vegas.

Industry watchers expect LG’s automotive business to have turned a profit last year for the first time, with sales estimated to have exceeded the 10 trillion won ($8 billion) mark. The value of orders secured are also projected to have reached a whopping 80 trillion won.

The renewed push for the automotive business comes after LG forecast a more than 90 percent plunge in operating profits in the fourth quarter last year in its earnings guidance announced earlier in the day.

In the October-December period, LG’s operating profit tumbled 91.2 percent to 65.5 billion won on-year, while sales increased 5.2 percent to 21.85 trillion during the same period.

Citing increased costs as the key factor behind the sluggish earnings, Cho predicted the growing costs could be lowered to a normal level starting early this month.

For the whole year, the company is expected to post record sales, he added.

The CEO also hinted that LG was preparing to launch a new-generation in-vehicle infotainment system that integrates all navigation, audio and video solutions, to expand its product lineup for electric vehicle chargers through merger and acquisition deals, and to beef up production of cutting-edge automotive displays.

“So far, we have focused on sales and operating profits. From now on, our top priority should be elevating corporate value,” Cho said.

“We will rebuild a competitive business structure not just for cost-cutting but to seek sustainable growth even in times of prolonged business slowdown.”

The company also said it was exploring new areas of business such as digital health care and the metaverse, while expanding content and service solutions sectors using its vast network of 180 million smart TVs sold globally.

When it comes to content business, Cho highlighted its soaring ad business, saying, “Our TVs are increasingly becoming a billboard for advertisers.”

When asked about a possible collaboration with Apple on its rumored “Apple Car” project, Cho said “I have nothing to confirm.” According to recent news reports, the iPhone maker reportedly had asked LG to create a consultative body together on the electric car project.

“I believe these media reports continue because we have a diverse business portfolio,” Cho said.

“But I want to say we do have a portfolio we can facilitate to work not only with Apple but also with other automotive companies.”

By Jo He-rim

Korea Herald Correspondent