Samsung stops producing smartphones in China. It has just closed its last factory still in operation in the country.

Samsung has shut down its last factory in China. It had been put on hiatus a few months ago, Reuters reports that it is now completely closed.

The Korean firm is moving away from China. The country has become its Achilles' heel according to the various statistics published by analysts. It prefers to relocate its production to preserve its costs.

6,000 workers work in the Huizhou factory and it still manufactured 63 million smartphones in 2017. This is a significant part of the 394 million units sold by the Korean giant that year.

The year before Samsung had already closed another of its factories in Tianjin, another region in China.

Samsung changes strategy in China

The equipment will be transferred to other parts of the world, particularly India and Vietnam. These two countries have become the Eldorado of manufacturers thanks to much lower production costs.

Manufacturing smartphones in China is no longer profitable for Samsung. Its market share fell to 1% in this country, according to estimates by the analysis firm Cape Investment & Securities.

Chinese consumers are turning to local brands at lower prices. At the other end of the chain, Huawei reigns supreme on the high end pursued by Apple.

Producing large quantities locally no longer makes sense for the Korean giant.

Samsung is not withdrawing from the Chinese market, however. The company may apply another strategy. It will have its smartphones built by other manufacturers like the Galaxy A6s and Galaxy A10s. The company simply stamped its mark on it.

Sony took the same step by closing its last Chinese factory earlier in the year.

Via