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Samsung puts a full stop on making phones in China

Mobile

CIO Bulletin
2019-10-03

Samsung has announced that it has shut the production of mobiles in China finally. The Korean mobile-maker has faced stiff competition in the world’s number one smartphone market in recent times.

Samsung has been cutting production in China which began last year with it shutting a plant. Much recently, it shut another factory located in Huizhou. The move is not surprising as the company’s market share has shrunk to just 1% in China as compared to 15% in mid-2013.

In fact, all the foreign entities in the Chinese market are feeling the heat as homegrown companies like Huawei, Oppo, Vivo, and, Xiaomi bring their best to the table. Combined with this the rising labor costs and economic slowdown is further putting the foreign companies at a disadvantage. Many companies are now looking towards countries like India and Vietnam for their production requirements.

Park Sung-soon, an analyst at Cape Investment & Securities told Reuters: “In China, people buy low-priced smartphones from domestic brands and high-end phones from Apple or Huawei. Samsung has little hope there to revive its share.”

Sony too has announced that it is stopping smartphone production in China. The company is now going to produce its phones in Thailand instead.