Samsung will no longer source Galaxy Note 7 batteries from its own battery-making division
Several reports have suggested that the faulty Galaxy Note 7 batteries at risk of overheating and explosion were sourced from Samsung SDI, the company’s battery-making division, and it’s believed to have met 70 percent of Samsung’s demand for the Galaxy Note 7. China’s Amperex Technology Limited or ATL is believed to have met the remaining 30 percent with focus on units headed to China. This is one of the reasons why customers in China are not affected by the Galaxy Note 7 recall.
The company is yet to assign blame to Samsung SDI publicly and it hasn’t said whether it’s going to stop sourcing batteries from it for the Galaxy Note 7 but this possibility has been rumored before. Reuters now hears from a person with knowledge of the plans that Samsung will be making ATL its main battery supplier for the Galaxy Note 7.
The scribe’s source says that ATL received orders from Samsung for additional Galaxy Note 7 batteries soon after it announced the global recall, it’s also said that ATL will completely take over the battery supply for this handset at least for the time being. ATL’s chief operating officer Joe Kit Chu Lam said he couldn’t comment on a specific client’s business but he did mention that his company saw a “significant increase” in business this month.
ATL expects this situation to continue for “the coming one to two quarters,” and doesn’t believe that this will create any capacity issue for the company. This means that ATL has the capacity to be the main supplier of Galaxy Note 7’s batteries even if Samsung decides not to source them from Samsung SDI for this handset. Multiple Korean news outlets are now reporting that Samsung will exclusively use batteries supplied by ATL for the Galaxy Note 7.