Faring Well
LG Hausys is striving to turn the tide in the high-performance materials and parts business which suffered a slump last year. Its efforts to target the market began in earnest as it has produced automotive fabrics in the US since April this year, along with its recent moves to reduce weight of parts gaining speed.
According to industry sources on August 11, the South Korea-based construction materials maker’s business is made up of such sectors as construction materials (60 percent) popularly known as windows & doors and flooring, high-functional materials & parts (38 percent), and common parts and others (2%).
The high-functional materials and parts sector is subdivided into two parts: automotive materials & fabric and home appliances & interior & IT film, with approximately 6 to 4 in the share of sales.
Out of the products, automotive fabrics are most appealing to the market. They refer to the surface materials used for car seats and dashboards. The company has a high-pressure resin transfer molding system to produce components made of reinforced plastics, similar to the production process of construction materials, facilitating the exchange of technologies.
LG Hausys now runs automotive skin production plants in Ulsan, South Korea, Tianjin, China, and Georgia, United States. It expects the operation of those facilities will bring about massive ripple effects as China and North America produce 40 percent of global automobiles. The local production is expected to improve quality control and price competitiveness.
The conditions can contribute to improving its performance, but the company also needs to make further efforts to reduce its heavy dependence on Hyundai-Kia Motors and the weight of parts. LG Hausys delivers approximately 70 percent of automotive material to the two auto companies, according to the industry related. Against the backdrop, analysis indicates that LG Hausys must diversify its sales channels in the coming years in that the proportion of General Motors and Chrysler, for which delivery is just the beginning, is insignificant.
The area of reducing the weight of parts shows some results. Earlier, LG Hausys tried to produce lighter parts to keep pace with the demand in the market that stresses gas mileage. As a result, it has successfully developed Long Fiber Thermoplastics (LFT) and Continuous Fiber Thermoplastics (CFT) four times stronger than LFT. The company is reportedly considering an acquisition of a US-based part company so as to speed up its technology development.