LG Electronics (Thailand) Co is asking its Korean parent firm to approve a two-billion-baht budget for business expansion next year despite the economic downturn. Hyun Woo Lee, the company's managing director, said the budget would be spent on upgrading the factory in Rayong and marketing.

''Though the economy is in a downturn, we won't slash marketing activities next year because Thailand will have less impact than other countries,'' said Mr Lee.

''We also plan to increase overall production capacity for TV sets by 7-10%.''

The company aims to spend US$5 million to expand the production capacity of LCD and plasma TVs from 100,000 units per year to 130,000 to serve increasing demand in the domestic market. It will reduce capacity of its conventional colour sets to 60,000 per month from 70,000.

Mr Lee expects demand for LCD TVs in Thailand will continue to grow by 30% to 650,000 units next year. The sales proportion of high-definition LCD sets should rise to 40% of the total LCD market, up from 10% at present. He said the price gap between ordinary and Full-HD LCD sets was now only 15-20% and would narrow to only 5-10% next year.

To capitalise on the trend, the company introduced 13 plasma and LCD models to the market in the fourth quarter, with half of them Full-HD models.

The company is looking to spur demand by spending 20 million baht on a marketing campaign called ''LG Full-HD World, Full Enjoyment''. Under the campaign running until Jan 12, LG is offering 24 models of TV sets, home theatre sets and Blu-ray disc players at discounts of up to 35%.

LG controls a 9% market share of LCD TVs and aims to increase the share to 20% next year.