×
  • Tech - News - Tech Companies
  • Updated: January 20, 2021

LG Hints At Exiting Mobile Market

LG Hints At Exiting Mobile Market

LG is considering calling it quits with the smartphone business this year, after recording nearly six successive years of losses and a $5 billion commitment.

According to Korea Herald, that CEO Kwon Bong-seok sent a message to staff, suggested that change was coming. A company official later told the Korean outlet that it was “about time for LG to make a cold judgment” about the ailing mobile division.

Citing fierce competition in the handset market, the official said that LG was looking at “sale, withdrawal and a downsizing of the smartphone business.”

Kwon, who assumed the position at LG in early 2020, promised that the mobile division would be “profitable by 2021.” He didn’t explain how he was planning to turn around the slide, beyond launching new phones with “wow factors to woo consumers.”

The company had last year, launched the Velvet (with a dual-screen case) and Wing, with its wacky flip-up display. 

READ MORE: LG Releases Teaser For Upcoming Rollable Phone

Naturally, LG has also been showing off its rollable phone, which was expected to debut at some point this year. That, however, is likely to sit in the ultra-premium tier, and may not be enough to reverse LG’s ever-dwindling market-share which StatCounter said had fallen to 1.7 percent in December 2020.

That same month, LG announced that it would outsource the design and construction of its low-end phones to third-party ODM manufacturers. 

In his message to the employees, Kwon reportedly said that some of the employees,   potentially around 60 percent, would be re-assigned to other parts of LG’s business. It’s not clear if the other 40 percent will remain in the far smaller mobile arm or let go, although it’s likely that LG will need to retain some of that institutional knowledge.

One of the reasons that Sony kept its mobile division running so long is to ensure it can leverage the technologies used in phones for any future frontier of gadgets.

LG had fallen into a second, deep slump but successfully managed to claw its way back to profitability after a loss-making 2013, but when it slipped again in 2015, they never looked like recovering.

After all, LG was unable to compete with (Korean rival) Samsung’s marketing might, or the low costs afforded by Chinese volume players like Huawei and BBK, the parent company of Oppo, Vivo, OnePlus, and Realme.

Related Topics

Join our Telegram platform to get news update Join Now

0 Comment(s)

See this post in...

Notice

We have selected third parties to use cookies for technical purposes as specified in the Cookie Policy. Use the “Accept All” button to consent or “Customize” button to set your cookie tracking settings