By Kim Eun-jin
Samsung Electronics plans to shut down its smartphone plant in Tianjin due to sluggish sales in the Chinese market.
Samsung Electronics announced on Dec. 12 that it would shut down its mobile phone manufacturing factory in Tianjin at the end of this month. In China, Samsung Electronics has produced mobile phones in Tianjin and Huizhou, with most of the smartphones produced in Tianjin exported.
The company’s decision is to focus more on the Indian and Vietnamese markets as its smartphone sales in China and the Tianjin plant’s capacity utilization show no signs of getting better. According to market research firm Strategy Analytics, Samsung Electronics accounted for just 0.7% of the Chinese smartphone market in the third quarter of this year with a sales volume of 700,000 units or so.
At present, Samsung Electronics is relocating its manufacturing facilities to India and Vietnam, where labor costs are lower than in China. Samsung Electronics’ smartphone manufacturing facilities in Vietnam currently account for approximately 50% of the company’s total smartphone production. Its factory in Noida, India is the largest smartphone manufacturing plant in the world. In China, Samsung Electronics released the Galaxy A6s last month. It is the first Samsung smartphone produced on an original development manufacturing (ODM) basis.