Samsung reportedly closes last mobile phone factory in China

By Song Lin Source:Global Times Published: 2019/10/3 16:30:40

Samsung Photo:Xinhua

South Korean tech giant Samsung, one of the leading smartphone producers in the world, has reportedly closed its last mobile phone factory in China after losing market share in the country amid the fierce business competition from domestic rivals.

Samsung will continue sales in China after it ended smartphone production in China, which was a difficult decision, in a bid to boost efficiency, Reuters quoted Samsung as saying on Wednesday.

The factory Samsung closed was located in Huizhou, South China's Guangdong Province, its third and last mobile phone factory in China, according to media reports, and the other two in Shenzhen, Guangdong Province and North China's Tianjin were either closed or suspended last year.

According to Counterpoint, a global industry analysis company, Samsung's market share in China, the world's largest smartphone market, has dropped to about one percent in the past two years behind several Chinese brands and Apple.

Chinese smartphone maker Huawei held a 36 percent market share in China in the second quarter of 2019, followed by Chinese brand Vivo's 19 percent and Oppo's 19 percent. Apple took 6 percent, down 3 percent from the first quarter, Counterpoint said.

"Intensifying market competition in China, especially from Huawei, is one of the main reasons for Samsung to lose its market share in China," Ma Jihua, a veteran industry analyst, told the Global Times on Thursday.

Samsung and Huawei have a similar target market, and it is difficult for Samsung to beat Huawei in China, Ma said, adding that the localization of Samsung's operating system was not satisfying, and domestic brands are more attractive to Chinese consumers.

Ma also pointed out that it is normal for a tech giant such as Samsung to adjust its global business strategy and transfer its smartphone production lines to other places with lower labor costs.

But Samsung still enjoys the largest global market share. In the second quarter, the company accounted for 22 percent of global smartphone shipments, topped smart phone makers in the world, followed by Huawei's 16 percent and Apple's 10 percent, according to Counterpoint.

Samsung customer support center on Thursday told the Global Times that they have not received related information yet.


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