LG is seriously considering its exit from the smartphone market, after nearly six years of uninterrupted losses and spending $ 5 billion. According to The Korea Herald newspaper; The company’s CEO, Kwon Bong-seok, said in a message to employees that LG is about to make a “hard decision”. Drawing attention to the fierce competition in the smartphone market, Kwon; He said that the sales, withdrawal and downsizing options are on the table.
Kwon took over LG in 2020 and promised that the mobile device unit would become profitable by 2021. Kwon did not share much information on how to change things and said they would only make phone calls that would surprise people. Accordingly, LG introduced devices such as Velvet and Wing last year.
LG has also showcased its folding screen phone several times, which is expected to be on the market this year. However, this phone is expected to be positioned in the upper segment and the company is not expected to increase its gradually decreasing share in the smartphone market. According to StatCounter data, as of December 2020, LG’s share in the smartphone market has decreased to 1.7 percent. LG recently announced that it will design and manufacture entry segment devices to other companies.
Kwon’s message is said to include the information that 60 percent of the employees of the LG mobile unit will be transferred to other units. It is not known whether the other 40 percent will work in the shrinking smartphone unit. It is stated that LG can keep the smartphone unit open, albeit on a small scale, in order to preserve its corporate information. It is said that using phone technologies on other devices is effective in keeping the smart phone unit open by Sony.
The claim to exit the smartphone market for LG has come to the fore before. However, the company announced that it had no such intention. However, LG, which has not recovered from damage in the mobile device market since 2015, seems to no longer force the competition with Samsung and Chinese manufacturers.