LG’s Downsizes PC Production

Image via Flickr by Joey DeVilla

LG, the South Korean manufacturer who took the consumer home appliance and electronics market by storm, is planning to announce that they are scaling down their production of personal computers heading into 2014. Part of the reason for the decision comes from the low market shares LG holds in the PC market. The other reason is the overall decline in global sales of desktop PCs as sales of laptops, notebooks, tablets, and other portable computing devices soars. Currently, the market for PCs has dropped about 14 percent this year. The announcement by LG is expected to take place at the 2014 International Consumer Electronics Show in Las Vegas on January 7, reports The Korea Times. Many of the components that go into the South Korean company’s computers are manufactured in Taiwan, but the Taiwanese supply chain is not expected to see a noticeable decline in business due to the upcoming announcement.

LG still holds a considerable chunk of the smartphone market as a top five manufacturer and vendor, holding about five percent of all the smartphone sales worldwide as of the end of the third quarter of 2013. The company’s newly formed home entertainment division is headed by Ha Hyeon-hoe, who is expected to make the January announcement. LG plans to focus more on the smaller, portable devices that are selling well instead of the larger desktop computers.

Another factor in the decision comes not from the worldwide computing market, but from the company’s own country. The government has decided not to continue purchasing the tower PCs produced by LG and Samsung. Sales for laptops and desktop computers combined is expected to be down by over 10 percent for the entire year. There are no announcements expected in regards to LG’s production of tablet computers or smartphones.

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