According to reports, the South Korean tech giant, Samsung has decreased the production capacity on the only functional plant it has in China. This action is coming just six months after Samsung shut down one of the only two manufacturing plants it had in China. This reduction will result in the plant’s workforce reducing as well. Although reports say that Samsung has confirmed that it has plans to reduce output at the plant, we still haven’t got any official statement by the company concerning the case.
The Chinese market was once a stronghold for the South Korean company but over the years, the emergence of local phone manufacturers within the country has seen that change. Back then, over 20 percent share of the Chinese market was controlled by Samsung. However, as Chinese brands continue to grow, this number continues to decrease. Local brands like Vivo, Oppo, Xiaomi and many others were able to ground against the global market leader thanks to their strategy of offering premium devices at a discounted price. At the end of last year, Samsung was reported to have less than a 1 percent share in the Chinese market.
There have been several efforts by Samsung to reclaim the glory which it lost in the Chinese market and other markets such as India where Chinese brands have taken a huge market share for themselves. A recent move by the company saw it shift its focus to the midrange section with the Galaxy A series as well as other premium models with affordable price tags. It is too early to say if this move has worked but we doubt if its sales numbers have changed very much. This latest development probably just goes to prove that the company has no path to a resurgence in the largest market in the world.
According to other reports, Samsung is giving workers at the ailing factory the chance to resign voluntarily with a compensation plan. A deadline date of June 14 has been set for employees who are interested to apply. This further suggests the company is trying to cut down running at the factory by all possible means. This also further entails that the company has no hope of resurgence in the country.