LG must even leave the cell phone business, and is in negotiations with potential buyers of its plant. After an internal memo distributed to its employees, Korean newspapers indicated that the likely buyer will be Vietnamese conglomerate VinGroup.
The Business Korea newspaper bets on VinGroup as having the best offer among those presented at the negotiating table to conclude the Korean corporation’s mobile business. In addition to being an original project manufacturer (ODM) of LG itself, VinGroup ranks third among smartphone producers in Vietnam, behind only Samsung and Oppo.
Losses in a row
As is already public knowledge, one of the main reasons why LG decided to dispose of its mobile unit is the continuous losses that have been occurring. According to the Korea Times, there are 23 quarters followed by operational losses, which demanded investments in the order of US $ 4.2 billion, equivalent to more than R $ 22 billion.
Originally an electronics manufacturer, LG started producing Android devices in 2001, even presenting some famous models, such as the Nexus 5, and the memorable G series. Recently, the company was betting on exclusive designs like the LG Wing and the future LG Rollable.
Unfortunately, creativity and differentiated model launches seem to have failed to drive LG’s business towards profit.