The strugle is real. This phrase rings true especially for Samsung as they continue to fight for market share in China. China arguably ranks as the world’s number one in terms of the smartphone market and with China-based OEMs like vivo, OPPO, Xiaomi and Huawei, the Korean tech giant barely manages to keep it in the low single digits – it has shrunk to 1% in the first quarter from around 15% in mid-2013.
The company has been in the past shutting down its factories and halting operations in their factories and this recent announcement is the final nail in the coffin.
The smartphone market in China points to users buying budget devices from domestic manufacturers and premium devices from the likes of Huawei and Apple. The recently launched Huawei Mate 30 generated $70 million(reportedly sold over a million units) in revenue in the first minute of going on sale.
This ultimately leaves no room for Samsung to compete and so is relocating its production equipment to other countries it has already ventured into like India and Vietnam depending on their global production strategy based on market needs.
Samsung will still sell its devices in the country.
The Korean tech company has also been playing around with the idea of ODM devices which are manufactured under licence by Chinese companies. Its two devices – the Galaxy A6s and Galaxy A10s are examples of devices not assembled in Samsung’s facilities. Estimates put it that Samsung could ship up to 40 million ODM devices manufactured this way in China.
Early this year, Sony pulled the plug on its Beijing smartphone production factory and this leaves Apple as the only non-Chinese OEM who produces smartphones in the country.