After 6 years of losses, LG considers leaving the smartphone business

LG makes some of the wackiest phones we’ve seen, including the swivelling, 5G-enabled LG Wing, while giving them some rather unique names, like the LG Velvet. However, it now appears that we might have to bid goodbye to these interesting devices, with LG reportedly considering leaving the smartphone business. Despite improved numbers recently, the Korean company has reported nearly six consecutive years of losses, totalling up to almost USD 5 billion (~RM20 billion).

As such, LG CEO Kwon Bong-seok apparently sent out an internal memo to staff that hinted at a major, upcoming change to the company’s smartphone division, as reported by The Korea Herald.

An LG official also told the Korean daily that a sale is being deliberated:

“Since the competition in the global market for mobile devices is getting fiercer, it is about time for LG to make a cold judgment and the best choice. The company is considering all possible measures, including sale, withdrawal and downsizing of the smartphone business.”

At the same time, the CEO says that employees will be retained—whatever happens to the mobile division. However, this reportedly only applies to 60 percent of the headcount, although there is no word on what LG plans to do with the remaining 40 percent. It’s worth noting that Kwon, when appointed as LG CEO in 2020, assured everyone that the company’s smartphone business would be “profitable by 2021”—although this latest development might make that an empty promise.

Meanwhile, LG Display (not officially part of the mobile division) is reportedly stopping production of LCD panels for iPhones, as reported by The Elec. Low profitability, coupled with the OLED displays found on newer iPhones, mean that the company is looking at a pivot towards display panels for car head units.

With regards to the LG smartphone division, this is sad news—although LG has been virtually non-existent in the mobile scene in Malaysia in recent years. The last device officially sold here under the LG brand was the LG V30+, nearly three years ago in 2018. Perhaps they might follow a similar path that Sony’s mobile division did, leaving the Southeast Asian market—and returning under the radar in 2019. Unfortunately, Sony sometimes takes a little too long to release their phones… you can read about an example of that here.

The current situation is that Vietnam’s Vingroup Co. has put forward an offer for LG’s smartphone division, while there are also a number of other entities that are interested in the sale. Vingroup, for some context, has only been in the smartphone market for a short while (since 2018), and the company is already the third largest smartphone producer in Vietnam. LG’s technologies and networks, consequently, could help them challenge Samsung and Oppo—their two main rivals in the Vietnamese smartphone space.

Other possible buyers would be big-hitters Facebook, as well as Google, Phonearena reports. Display-makers BOE are interested as well, while Volkswagen have also reportedly thrown their hats into the ring. Regardless of that, it’ll be sad day if we never see LG smartphones again—and we certainly want to see the LG Rollable, whatever the outcome.

[ SOURCE , 2 , VIA ]