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Audiovox: Expect RCA To Grow

1/07/2008 02:00:00 AM Eastern

Audiovox contended it will build RCA's brand share in the electronics market.

When Audiovox takes over the business in January, Audiovox president/CEO Pat Lavelle said, Audiovox will "promote the brand very heavily and bring in the new products that Thomson was working on [and] some of the products we see could fit in the line." The brand will "explore new categories," he said.

For the past few years, Audiovox founder and chairman John Shalam said, "the former owner of RCA has been in a disposal mode and had stopped investing in the infrastructure of these companies, particularly in product development." The company, he contended, was "limping along," but "with our management and financial resources, and the team of people we acquired from RCA, we are now beginning to encourage them to develop dynamic new products."

In low-margin "niches" or in products in which RCA was losing money, Lavelle said, Audiovox will license the RCA brand as it does with some of its other brands. In these cases, however, Audiovox retains the right to ensure the products meets is specs, he noted.

In RCA accessories, under Audiovox ownership since January 2007, the company will leverage the brand's No. 1 unit share in remote controls and move up average selling prices, Lavelle said.

Audiovox also sees the potential to grow the RCA business in Europe and will test sales wherever opportunities arise in accessories and electronics, Lavelle added.

Audiovox, however, has no plans to bring its European brands to the United States, or its other U.S. brands, other than Audiovox, to Europe. "European brands are European brands, and they do well there and may not do well here," Lavelle said. That's "often true of U.S. brands, too," he said.

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