Samsung, for its declining sales in China, has decided to shut down one of its Chinese mobile phones plant. China is the biggest smartphone market in the world and Samsung, due to its declining sales in Chinese market because of the rising competition from the local rivals offering much cheaper smartphones, has decided to close operations at one of its mobile phone manufacturing plant in northern Chinese city of Tianjin.
According to market research firm Counterpoint, Samsung’s share in Chinese smartphone market, after not succeeding to struggle local brands like Huawei mostly for their prices, has now been touching down to only 1 percent in first quarter of this year, which was about 15 percent in year 2013.
As listed by the Samsung, the plant, Tianjin Samsung Electronics Telecommunication, will be going to close by the end of this year.
Compensation packages and opportunities to transfer to other Samsung facilities has be announced by the Samsung for about 2,600 currently working the closing plant.
Keeping its other Chinese phone manufacturing plant at Huizhou, in the southern province of Guangdong, remained operational, Samsung has been focusing its production in low-cost countries like India and .
Samsung has already been manufacturing mobile phone in Vietnam in two of its factories, whereas in July for the surging demand of mobile phones in the country, Samsung opened one of the its biggest manufacturing plants, with eventual production facility of 120 million units per year, in Indian capital city of New Delhi.
For the production capacity of any of its factories in China or Vietnam, Samsung refuses to disclose. But according to Electronic Times, a South Korean newspaper, Samsung’s two factories in Vietnam jointly producing about 240 million phones every year, whereas its Chinese factories make 108 million units per year combined, out of which 36 million units has been manufactured at Tianjin plant and Samsungs Huizhou plant produces 72 million units.