LG stops manufacturing phones: Report
LG will no longer manufacture handsets as it aims to exit the smartphone business by end of July this year.
LG in April this year announced the closure of its smartphone business. The company had then said it would continue to sell phones to clear its inventory as well as manufacture to complete the contracts. Ahead of its July 31 deadline for complete shutdown, LG has now stopped the smartphone production line.
According to Asia Business Daily (via Engadget), LG will convert a factory in Vietnam, where many of its phones are manufactured, into a household appliance manufacturing unit. There is no word on other production units.
LG had said it would exit the smartphone business by the end of July. The move followed a spate of financial losses in the mobile division. Before announcing the shutdown, it also contemplated several options, including selling the unit. Reports suggest LG held talks with Google, Facebook, Volkswagen and Vietnam's Bean Group.
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As far as financial losses go, LG's mobile division incurred losses since the second quarter of 2015 and continued to do so for 23 consecutive quarters. According to a Counterpoint Research report, LG's smartphone shipments were only 6.5 million units, and its global share stood at only 2% in Q3 2020.
Apart from selling some of its remaining inventory, LG said it would also provide service support and software updates for customers for a certain period. The company said all premium LG smartphones currently in use would receive up to three iterations of Android updates from the year of the purchase.
The three-year OS update guarantee applies to LG premium phones released in 2019 and later (G series, V series, VELVET, Wing). Select 2020 models such as LG Stylo and K smartphone series will receive at least two OS updates.
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