No more Philips TVs for North America

It was one of the oldest and largest manufacturers of televisions for so many years, but in a world of crashing LCD prices and cross-sourcing, it seems that Philips can no longer compete in the largest territory and is handing over its North American business interests, lock stock and barrel, to Funai. The Japanese corporation will still continue to use the Philips and Magnavox branding of course, but behind the badge, Funai will handle all of the sourcing and selling.

The new agreement with Funai, a long-time business partner, will ensure that Philips still takes royalties from sales in the lucrative US market and Philips will get up to EUR 125m during 2008 to cover ‘costs’ associated with the transfer. As well as taking over America, Funai will also gain access to Philips’ world-class R&D department in the Netherlands to make sure new lines like the recently launched ‘Design Collection’ continue to hit quality control.

It looks like a grim day for Philips after its President and Chief Exec, Gerard Kleisterlee announced the “decisive steps in addressing the unacceptable profitability levels in our TV business in 2008,”. But a good day for Funai. “As a premium brand, Philips will add lustre to our existing portfolio.” Said President and CEO, Tetsuro Funai. It certainly should do that.
Philips (via Gizmodo)

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