Monday, 3 September 2007

LG Might Cease CDMA Handset Sales in India

LG, the South Korean cheabol says it might stop selling CDMA phones in India sue to rising imports of cheap CDMA phones from China, the world’s largest maker of CDMA handsets...

LG, the South Korean cheabol says it might stop selling Code Division Multiple Access (CDMA) phones in India sue to rising imports of cheap CDMA phones from China, the world’s largest maker of CDMA handsets.

LG’s CDMA handsets sales have reduced drastically and this has forced the company to stop selling its CDMA handsets. In fact Reliance Mobile, India’s second biggest mobile operator, which is also one of the world’s largest CDMA operator, has started selling its own branded handsets imported from China. Tata Indicom, another CDMA operator is importing most of its CDMA handsets from Huawei and ZTE, both Chinese companies.

LG, which has a mobile phones manufacturing facility in India said it will stick to selling lucrative GSM handsets in India. "We are bleeding in the CDMA market because of cheap Chinese handsets. We can’t continue like this for long. It all depends on profitability. If we don’t make profit, we will exit the business," LG India MD Moon B Shin said.

LG's revenues from selling CDMA handsets shrank to USD250 million in calendar year 2006 from USD300 million in 2005. The company has set an even lower target of USD150 million for the current year. The company sold 9 million CDMA handsets last year and aims to sell 7 million units this year.