* To boost sales of auto components
* Initial focus on infotainment, autonomous driving
* Firm in need of growth driver as smartphones falter
(Adds further comments from Samsung and analyst, context)
SEOUL, Dec 9 Samsung Electronics Co Ltd
said on Wednesday it will create a team to develop
automotive-related businesses, as it searches for a new profit
driver while struggles at its smartphone division deepen.
Samsung, in a statement, said the team will work outside of
existing divisions to grow sales of car components, with initial
focus on in-car entertainment, satellite navigation and
autonomous driving technologies. The team will also work with
other technology arms of the Samsung Group.
Investors and analysts have increasingly called on Samsung
to leverage its strength in fields such as chips and displays to
tap demand from carmakers seeking increasingly sophisticated
technologies for their vehicles.
Meanwhile, market estimates suggest profit from smartphones
- Samsung's former cashcow - is set fall in 2015 for the second
consecutive year, putting pressure on the manufacturer to find
new profit drivers.
U.S. patent filings data compiled by Thomson Reuters IP &
Sciences showed increasing efforts by the world's top smartphone
maker and its affiliates to push into the rapidly growing market
for automotive components, software and services that is worth
around $500 billion.
Samsung Electronics and affiliates such as battery producer
Samsung SDI Co Ltd and electronic components maker
Samsung Electro-Mechanics Co Ltd can become major
forces in automotive technology by combining offerings into a
single platform, investors and analysts said.
But they point out that it could take several years before
Samsung Electronics sees meaningful earnings contribution from
car-related sales. Product cycles in the car industry often last
several years and require more rigorous safety standards than
SK Securities analyst Kim Young-woo said while Samsung
Electronics is moving in the right direction, Samsung Group as a
whole needs to combine key component-making operations under a
single umbrella in order to succeed.
"Now that Samsung Electronics rolled up its sleeves, there
needs to be a move to consolidate all the different parts into
one," Kim said.
(Reporting by Se Young Lee; Editing by Christopher Cushing)