Samsung’s last smartphone plant in China cuts production and jobs

Samsung was once a dominant player in the Chinese smartphone market with more than 20% market share. As Chinese brands continued to proliferate, it kept ceding space in the world’s largest smartphone market, finally falling below 1% share last year. Unsurprisingly, the poor performance had business repercussions with the company closing one of its two manufacturing plants in the country six months back.

The Korean company vowed to fight back and improve its standing in the Chinese market, but its efforts haven’t been successful so far. With no clear path to bounce back, it is now cutting production and jobs at its Huizhou plant in China’s Guangdong province. Samsung has confirmed plans to cut output at the plant, but there is no official statement about the layoffs yet.

Samsung didn’t provide any information about the quantum of production cut or layoffs when contacted by Reuters. The news about layoffs at the plant is coming from a report in Caixin which claims to have seen a corresponding document. It says Samsung is offering voluntary layoffs with compensation and is asking interested employees to apply before June 14. No information is available currently about the number of jobs affected by this move.

Over the years, Samsung has shifted its manufacturing bases to Vietnam and India to cater to various markets around the world, leaving the plants in China limited to servicing the domestic market. Reduction in output and layoffs at its last Chinese plant indicates that the company is not very hopeful of a revival in the region.

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