The reports from the original Korea were correct, LG is closing down the mobile business. With losses continuing to rise, and billions of dollars apparently being wasted on weird phones, the electronics giant has officially thrown in the towel on its struggling phone division. In a statement, the company said: “Going forward, LG will continue to leverage its mobile expertise and develop mobility-related technologies such as 6G to further strengthen its competitiveness in other business areas.”
For now, LG said that the current phone inventory is still available for sale, and that existing devices will continue to receive after-sales support and software updates “for a period that will vary by region.”
Despite the CEO’s promise to turn around his fortune by 2021, both LG’s Velvet and Wing units failed to withdraw from the public eye. The lid with dual-screen phones (and the promise of scrolling screens) was clearly not enough to make consumers different from dominant players Apple and Samsung. While the litany of affordable flagships from the likes of OnePlus and Xiaomi continued to track down what was left of the market share.
In December, the writing was on the wall for the Korean electronics giant. With its stake in the global phone market down to just 1.7 percent, LG announced that it will outsource the designs of several of its low- and medium-sized phones to third parties. Just a few months earlier, it had tried to crack the cheap $ 400 K92 5G phone arena.
“The LG brand’s departure from the mobile space may be disappointing for some, but we are in an industry where it is also critically important to swing and do what’s best for employees and shareholders,” LG Global Communications Manager Ken Hong told Engadget. “As other popular phone brands have demonstrated before us, it’s a numbers game, not a popularity contest.”
LG was clearly not ready to give up the smartphone ambitions without a fight. Last month, Korean newspaper Dong-A Ilbo reported that there were even talks to sell the fluttering business to Germany’s Volkswagen AG and Vietnam’s Vingroup JSC, but the discussions eventually failed. According to Nikkei Asia, LG’s inability to increase its smartphone business was affected at least in part by a global storage of semiconductors – unlike its domestic competitor Samsung, LG does not produce its own smartphone chipsets, and limited access has meant that the company has struggled to secure adequately. supply of silicon for future mobile devices.
LG’s full statement can be found below:
“LG Electronics Inc. (LG) announced that it is closing its mobile business unit. The decision was approved by the board earlier today.
LG’s strategic decision to exit the incredibly competitive mobile phone sector will enable the company to focus resources on growth areas such as electric vehicle components, connected devices, smart homes, robots, artificial intelligence and business-to-business solutions, as well as platforms and services .
The current LG phone inventory will still be available for sale. LG will provide service support and software updates for customers of existing mobile products for a period that will vary by region. LG will work with suppliers and business partners throughout the closure of the mobile phone business. Details related to employment will be determined at the local level.
Going forward, LG will continue to leverage its mobile expertise and develop mobility-related technologies such as 6G to further strengthen its competitiveness in other business areas. Core technologies developed over the two decades of LG’s mobile business operations will also be retained and applied to existing and future products.
The winding up of the mobile phone business is expected to be completed by 31 July, although inventory of some existing models may still be available thereafter. “
Chris Velazco and Richard Lawler contributed to this story.