Humax Set to Jump in to the ‘Automotive Electrical & Electronic Business’
-Humax makes an additional 20 billion won investment in Daewoo IS, a car stereo and AVN manufacturer, increasing
the total investment to 25 billion won, acquiring a 50-percent stake in DWIS
-Gaining greater access to the automotive market, Humax sets its sales goal to250 billion won in the automotive
electrical & electronic business this year
May 22, 2012 – Humax is set to jump in to the automotive electrical & electronic business.
Humax (President Byun Dae-gyu, www.humaxdigital.com) announced at its board meeting on May 21st that they have decided to participate in a paid-in capital increase of Daewoo IS (DWIS), which specializes in manufacturing car stereos and AVNs(Audio Visual Navigation). Earlier in December 2009, Humax invested 5 billion won in DWIS. This time, Humax decided to invest an additional 20 billion won, increasing the total investment to 25 billion won, acquiring a 50-percent stake in DWIS, which will give Humax the managerial right over DWIS and therefore will allow Humax greater access to the automotive market.
Following its core digital set-top box business, Humax decided to advance into the automotive electrical & electronic business in 2009 as part of its new growth drive. For the last 2-3 years, the company has been preparing to jump in with both feet, buying a stake in DWIS, launching the automotive set-top box in Japan.
This investment means that Humax is going to expand its electrical & electronic business, which it has been preparing to do on its own. It also suggests that the company will be able to build this business earnestly by acquiring the managerial right over DWIS, which has long provided car stereos and AVNs to global automakers, such as GM and Renault-Nissan.
President Byun Dae-gyu said, “We will be able to get over the first barrier to entry using the existing customer base of DWIS. And if we can meet the demand for high-end products by combining our capabilities as a hardware and software developer with competencies as a manufacturer in production, purchase, and quality, we will be able to attain competitive advantages.” He added, “Just as we had noticed the market shift of broadcast digitalization and found a business opportunity in the set-top box market, we are going for another business innovation in the automotive market.”
Humax views this business expansion as a great opportunity since both in-car network and connectivity between car and IT devices (or, between car and external network) have recently increased in importance in the automotive electrical & electronic industry in addition to shrinking product replacement cycles. Besides, automakers are breaking the habit of relying on its subsidiaries for development and purchase of electrical & electronic components.
Backed by its competency in development and manufacturing, Humax is planning to actively expand its customer base and diversify its product lines by enhancing its product competitiveness and service to the existing business partners, focusing on early development of high-end products, such as AVNs.
Founded in 1971, DWIS, a spin-off company from the car stereo division of Daewoo Electronics in 2007, started developing and producing car stereos in 1979 and has supplied car stereos and AVNs to global automakers, such as GM and Renault-Nissan, for over 30 years. The company posted 111.1 billion won in sales in 2010 and 166.6 billion won in 2011, and aims to reach 250 billion won this year and 300 billion won next year.