Samsung cuts phone production by 30 million units

SAMSUNG

Samsung Electronics is set to cut its phone production by 30 million units this year, according to SamMobile, citing a report from Korean publication Maeil Business News.

According to the report, three main reasons have been identified behind the move by the South Korean tech giant, including the decline in global smartphone demand due to ever-increasing inflation, supply chain restrictions and the ongoing war between Russia and Ukraine.

Initially, Samsung had set a target of producing 310 million units of smartphones by 2022, but has now decided to reduce this to 280 million units, which is about 10 percent less than the target it had set last year.

This reduction in production targets also includes all devices, from low- to mid-end smartphones to high-end flagship models.

After producing 300 million units in 2017, Samsung Electronics has remained in the mid-to-end range of 200 million since then. It is the first time in five years that the company has set a target of producing 300 million units this year.

Citing Park Hyung-woo, a researcher at the Shinhan Financial Investments firm, the publication said the company is slashing its smartphone production by 35% in May compared to the January-April quarter average, which is expected to increase by 35%. decrease of 10 percent.

In addition to smartphones, the above factors are also likely to affect Samsung electronic component manufacturers. The company recently revised its order to cut supply by up to a month.

Samsung is not the only company affected by the current market conditions. Last year, Apple Inc. production of its iPhone 13 model for 2021 by a staggering 10 million units due to the global chip shortage.

Also this year, the Cupertino giant has scaled back its smartphone production for 2022 by reportedly cutting production of the iPhone SE (mid-low-end model) by 20%.

Samsung has not yet commented on the report.

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