The reports from its native Korea were correct, LG shutting down its mobile business. As losses continue to rise, and billions of dollars seemingly wasted on quirky devices, the electronics giant has officially thrown in the towel on its struggling phone division. In a statement, the company said “LG will continue to leverage its mobile expertise and develop mobility-related technologies such as 6G to further strengthen competitiveness in other business areas.”
LG has tentatively said that its current phone stock will remain available for sale, and that existing devices will receive after-sales support and software updates “for a period that will vary by region.” The company expects to complete the abolition of its mobile business by the end of July, although it notes that some LG phones will still sell after the date.
Despite the CEO’s promise to turn around his fortunes by 2021, both Velvet and Wing devices could not get the traction with the public. The lure of dual-screen phones (and the promise of scrolling screens) was clearly not enough to make consumers separate from the dominant players Apple and Samsung. While the litania of affordable flagships from people like OnePlus and Xiaomi continued with the rest of its market share.
By December, the writing was on the wall for the Korean electronics giant. With its stake in the global phone market to a meager 1.7 percent, LG has announced that it will outsource the designs of more of its low- and mid-range devices to third parties. Just a few months earlier, he had been trying to crack down on the cheap $ 400 K92 phone arena.
“The departure of the LG brand from the mobile space may be disappointing for some, but we are in an industry where the key interests of employees and shareholders are also important,” said LG Hong’s Head of Global Corporate Communications, told Engadget. “As other beloved phone brands have shown us before, this is a number game, not a popularity contest.”
Clearly, LG was not ready to give up its smartphone ambitions without fighting. Last month, Korean newspaper Dong-A Ilbo reported that it was even in talks to sell the pendulum industry to the Volkswagen Volkswagen AG and Vingroup JSC in Vietnam, but the discussions eventually failed. According to Nikkei AsiaLG’s inability to sharpen its smartphone business has been affected, at least in part, by a worldwide semiconductor storage – unlike its local rival Samsung, LG does not produce its own smartphone chips, and the limited supply has meant that the company struggled to get enough stock of silicone for future mobile devices.
LG’s full statement can be found below:
“LG Electronics Inc. (LG) has announced that it will close its mobile business unit. The decision was approved by the board earlier today.
LG’s strategic decision to leave the incredibly competitive mobile phone sector will enable the company to focus resources on growth areas such as parts for electric vehicles, connected devices, smart homes, robotics, artificial intelligence and business-to-business solutions, as well as platforms and services.
Current LG phone stock will still be available for sale. LG will provide service support and software updates to customers of existing mobile products for a period that will vary by region. LG will work with suppliers and business partners during the closure of the mobile phone business. Employment details will be determined at local level.
LG will continue to leverage its mobile expertise and develop mobility-related technologies such as 6G to further enhance competitiveness in other business areas. Core technologies developed during the two decades of LG’s mobile business operations will also be retained and applied to existing and future products.
The abolition of the mobile phone business is expected to be completed by July 31, although the stock of some existing models will still be available thereafter. ‘
Chris Velazco and Richard Lawler contributed to this story.