Visitors experience HARMAN Ready Care driver monitoring system at the Samsung Electronics booth at CES 2023 in Las Vegas on Jan. 5, 2023. (Yonhap)
SEOUL, May 2 (Korea Bizwire) — Instead of sluggish demand for products like TVs and semiconductors, South Korea’s major tech companies are finding a new cash cow in the automotive business.
Harman International, an automotive electronics subsidiary of Samsung Electronics Co., recorded sales of 3.17 trillion won ($2.36 billion) and an operating profit of 130 billion won in the first quarter of this year
These results represent the highest first-quarter sales and operating profits in the company’s history, with year-on-year growth rates of 18.7 percent and 30 percent, respectively.
Analysts suggest that combining Samsung’s IT competitiveness, including software, is gradually creating synergy.
Harman recently partnered with Italian sports car manufacturer Ferrari to provide its Ready Upgrade solution.
Meanwhile, LG Electronics Inc.’s vehicle component solutions (VS) division set new first-quarter records with sales of 2.38 trillion won and an operating profit of 54 billion won.
The tech giant’s automotive business is mainly led by three core businesses: the VS division’s in-vehicle infotainment system, in-vehicle lighting systems for subsidiary ZKW Group, and electric vehicle powertrains for joint venture LG Magna e-Powertrain.
LG’s order backlog surpassed 80 trillion won last year and is expected to exceed 100 trillion won by the end of this year.
This photo provided by LG Electronics Inc. shows a digital cockpit built with the company’s infotainment system.
Amid the global economic slump, electronic component makers are looking for a breakthrough in automotive electrification.
Samsung Electro-Mechanics Co. recently noted in its conference call that demand for automotive multilayer ceramic capacitors (MLCCs) is expected to continue growing this year thanks to diversified customers.
The profitability of automotive electrification products is improving on the back of the expansion of high-value-added products and an increase in revenues.
LG Innotek Co., an IT parts manufacturer, reported overall sluggish performance but its automotive business recorded 22 percent growth in sales to 381.7 billion won.
Despite the supply shortage of automotive semiconductors, sales of components for electric and self-driving vehicles, such as battery management systems and communication modules, registered strong growth.
J. S. Shin (js_shin@koreabizwire.com)
