JaeSeung Lee, President and Head of Samsung Electronics’ Digital Appliances Business, with a Bespoke refrigerator.
By Alan Wolf, YSN
Samsung’s top appliance exec said the pandemic-driven boom in white-goods sales will last longer than the company had previously projected.
JaeSeung Lee, who heads the company’s global home appliance business, told Reuters that he had expected sales to begin subsiding from their COVID-triggered highs after the first quarter of this year. But with vacation travel still limited and consumers flush with economic-stimulus cash, he now believes demand will remain rampant into the second half of 2021.
To help meet that seemingly insatiable demand, Samsung is adding new production lines in the U.S., Mexico and Korea, and has diversified its sourcing for an increasingly hard-to-come-by component: Semiconductors. The vendor is now sourcing two or more suppliers per chip from multiple countries including Japan, Taiwan and China, while switching to larger and more readily available wafers and implementing software workarounds, Lee said.
Samsung is also relieving some of its output pressure by outsourcing elements of its new Bespoke line of customizable appliances, which has increased production by 30 percent to 50 percent without massive investment, he told the news service.
The company reported higher year-over-year and successive-quarter profits for the three months ended March 31, due in large measure to strong continuing demand for digital appliances. Samsung doesn’t break out its home appliance earnings, but Reuters cited an estimate from financial services firm Eugene Investment & Securities that pegged the business’s operating profit for Q1 at about $358 million, more than double its haul from the year-ago quarter.