Global electronics maker building reputation to attain industry leadership
LG Electronics is increasing the drive to ratchet up its market share in the water treatment industry, a move considered to be both timely and lucrative due to the mounting concerns for water shortage amid a global initiative to promote eco-friendly growth.
“Climate change and environmental pollution are expected to continue squeezing the world’s water supplies, which is why we believe that treating water is a business that will see sustainable growth,” said Lee Young-ha, president of LG Electronics’ Home Appliance Company.
LG Electronics’ home appliance president Lee Young-ha (left) shakes hands with Hitachi Plant Technologies president Toshiaki Higashihara after signing an agreement to establish a new joint venture named LG-Hitachi Water Solutions Co. at LG Twin Towers in Yeouido, Seoul, early this month. (LGE)
The global electronics powerhouse, known for its meticulous and measured approach to new initiatives, has it all mapped out.
It will start out by steadily building its reputation in the area of water treatment systems for industrial sectors.
Afterwards, the firm plans to apply itself to wider markets by catering to domestic sewage systems in the public sector at home and abroad, company officials said.
To make sure its plans take off, LG Electronics is concentrating its research and development on building state-of-the-art equipment and systems for treating water, particularly membranes, which are considered as the core element in water treatment solutions.
The Seoul-based company’s initiative to venture into the water purification industry was launched in earnest in September last year.
Aware of the huge potential profit ― for both the company and the consumers who will undoubtedly feel the pinch of water shortages according to experts ― the business would bring, LG Electronics pledged to invest $400 million or more in the ensuing 10 years.
The firm’s ultimate plan is to become a top 10 global water treatment company with revenues of up to $7 billion 2020.
The goal may be ambitious, but it is more than realistic considering the head start LG Electronics has made, according to industry sources.
The water treatment business will also appeal to shareholders at both home and abroad, many of whom are aware of how significant it is for companies to be more environmentally conscious.
LG previously cited research showing that one in every six people on the planet do not have access to clean water.
As a part of its water purifying initiative, LG Electronics recently signed up to create a joint venture water treatment company with Hitachi Plant Technologies of Japan.
The company, named LG-Hitachi Water Solutions Co., Ltd., will be based in Seoul. Operations are to begin this October.
“This company is going to rapidly rise to become one of the world’s leading companies in the water purifying industry, as it will combine LG Electronics’ sales network, capacity and technological prowess with Hitachi Plant Technologies’ extensive expertise,” Lee of the home appliance unit said.
The joint venture will mostly focus on catering to municipal water supply systems, municipal sewage treatment systems, industrial water supply systems, industrial wastewater treatment systems and the reuse and recycling of wastewater for local companies and governments, LG Electronics said.
LG will hold a 51 percent equity interest, while Hitachi Plant Technologies has 49 percent.
By Kim Ji-hyun (email@example.com