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LG said to suspend production of phones in home country of Korea


The fortunes of LG Mobile, the embattled and rather overshadowed rival to Samsung Mobile, have been on a downward trajectory for a long time.
As part of its effort to reform and optimize that business, LG is now reportedly taking the step of discontinuing smartphone manufacturing in its home country of Korea. The news comes from the local Yonhap News Agency, via Reuters, which suggests that LG will reallocate its current Korean production to a plant in Vietnam.

LG’s home manufacturing is presently focused on its flagship devices, with Reuters reporting that it accounts for somewhere between a tenth and a fifth of LG’s total phone output. There’s a lot of pride invested in putting the “Made in Korea” label on LG’s best mobile products, so this decision will not have been reached lightly. Then again, given the chronic failure of LG Mobile to turn a profit, it’s obvious that LG had to take measures to cut costs. Raising prices, the other path to balancing the books, seems an unlikely strategy for success at the moment, with LG lagging behind Android phone rivals with better cameras, bigger batteries, and smoother performance.

This is far from the end of LG’s mobile division, but it may be the beginning of the end. LG continues to occupy a privileged position as the third option after Apple and Samsung phones in most US carrier stores, and it enjoys a loyal following at home in Korea. But if it can’t produce competitive devices, its inability to sustain phone manufacturing at home may well spread to its cheaper plants overseas. At this point, only a series of great new phones is likely to stem the slow demise of LG’s consumer smartphone business.

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