Solid performance in a mixed environment
Asia-Pacific, Middle East and Africa
Position and Strengths
- Leading market position in Australia and New Zealand, especially in cooking. These two markets account for about half of sales in the business area.
- Strong market position in targeted segments in Southeast Asia, especially front- load washers where Electrolux has strengthened its market share in recent years.
- Leading positions in Floor Care in parts of the region such as Australia, Japan and Korea, and the largest manufacturer of water heaters in South Africa and Egypt.
- High brand recognition in large parts of the region where Electrolux is associated with European Quality & Care, which is in line with consumer demand.
- Modern manufacturing capability in Rayong, Thailand, with economies of scale in a low-cost location. About 80% of the products sold in the region are produced in Rayong, Egypt and South Africa.
To achieve profitable growth, Electrolux applies a three-step model.
The business area Asia-Pacific, Middle East and Africa is in the third step, Targeted Growth.
Strategic focus
- Ensure a lean and efficient organizational structure tailored to leverage in the different local markets.
- Continue to invest in premium products to improve product mix in key categories in Taste, Care and Wellbeing, as well as expand the AEG offering, primarily in Australia and China.
- Drive expansion in growing new channels, such as developers in Southeast Asia and the Gulf region.
- Investments in new product platforms for laundry and water heaters for the Middle East region.
- Pursue joint-ventures and acquisitions to accelerate profitable growth in this attractive and growing region.
- Drive sales in the profitable aftermarket segment as well as accelerate the launch of connected products and ecosystems. The Asian market for connected products is more advanced compared to most other regions.
Net sales and operating margin
share of net sales
13%
Operating margin1)
5.6%
1) Excl. non-recurring items
2019 Execution
- Organic sales decline of 1.3%, mainly related to lower volumes and, in Southeast Asia, price pressure. Mix contributed positively across product categories and in most regions, notably in Australia.
- Reduced operating income and margin mainly due to significant currency headwinds as well as lower organic sales. Investments in major product launches increased, while production efficiency contributed positively. Non-recurring costs of SEK 398 (0)m were included in operating income and related to restructuring charges and outsourcing projects for efficiency measures, see note 7 in the annual report.
- Introduced a comprehensive new range of appliances and a new visual identity under the Electrolux brand in Australia.
- Integrated the Middle East and Africa operations into the business area to strengthen the emerging market offering and leverage global scale. The Home Care and SDA operation was fully integrated resulting in efficiencies in term of product and marketing organization.
- Initiated the streamlining of the organization to improve efficiency and sales execution by decentralizing and strengthening local sales teams.
Explore our case stories from Asia-Pacific, Middle East and Africa
CASE STORY ~ TASTE
Global presence strengthens offering in attractive refrigerator segment
Electrolux
Electrolux is a leading global appliance company that has shaped living for the better for more than 100 years. We reinvent taste, care and wellbeing experiences for millions of people around the world, always striving to be at the forefront of sustainability in society through our solutions and operations. Under our brands, including Electrolux, AEG and Frigidaire, we sell approximately 60 million household products in approximately 120 markets every year. In 2019 Electrolux had sales of SEK 119 billion and employed 49,000 people around the world.
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