Posted by MichaelR 4 months ago

Samsung moving smartphone production to Vietnam to protect profit margins

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Samsung makes a lot of money off its smartphones thanks to high sales and some exorbitant profit margins on devices, and now the Korean manufacturer is reportedly making plans to shift some of its production from China to Vietnam, where it can “secure even lower wages and defend profit margins,” according to Bloomberg. Samsung’s $2 billion plant in Vietnam will start producing devices in February next year, and by 2015, it will be responsible for around 40 percent of the company’s smartphones.

Basically, this is Samsung’s attempt to make sure it keeps making as much cash as before, especially since it will be focusing on low-end and mid-range devices, including a tablet that costs around 100 Euros, going forward, in an attempt to ward off competition from Chinese and other manufacturers that make low-margin high-value products to attract consumers. Vietnam’s labor costs are almost one-third of those in China, so while prices of Samsung’s phones and tablets might go down in the coming years, it will be offset by the lower costs of production that will result from a shift to Vietnam.

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5 comments on “Samsung moving smartphone production to Vietnam to protect profit margins

  1. davielo 4 months ago said:

    My Note 3 N900 was made in Vietnam already!
    Where are the N9005s made at the moment?

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    • Abhijeet M. 4 months ago said:

      Almost everyone has some production going on in Vietnam, but it’s usually divided between different nations. However, with this move it seems Vietnam will become an even bigger contributor towards assembling Samsung’s devices.

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  2. khaaba 4 months ago said:

    Hehehe my S3 which was purchased October last year was from Vietnam :-D

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  3. Yucko 4 months ago said:

    until people start jumping off factory roofs there aswel

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  4. imart 4 months ago said:

    better vietnam then china.. my first galaxy ace was chinese, but new s4 mini and tab 3 are from vietnam..

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