Smartphone giant Samsung is considering shutting down operations at one of two mobile phone factories in China due to weak smartphone sales and increasing labour costs in the country, The Electronic Times (ET) reported.
Sources told the newspaper the South Korean vendor plans to halt operations at Tianjin Samsung Telecommunication, located southeast of Beijing, as early as 2019 to focus its capabilities on emerging markets including India.
The company reportedly already informed key suppliers of the plan. Samsung also has a handset plant in Huizhou, southern China.
China’s smartphone market declined in Q2 with shipments falling 5.9 per cent year-on-year, data from IDC showed. Samsung is not one of the top five handset vendors in the mainland.
A Samsung representative told the ET: “The production volume of the Tianjin [factory] has been steadily decreasing and it is expected to decrease in the future.”
Samsung last month started operations at an upgraded manufacturing facility in northern India, a move aimed at doubling handset production and securing a top position in the world’s second-largest smartphone market. The company will also use the facility to meet global smartphone demand.