On April 20, LG Electronics said it was planning to produce home appliances based on a smartphone production line in Hai Phong after withdrawing from this business completely.
According to the latest plan, Yonhap News reported that LG plans to complete the transformation of its smartphone factory in Hai Phong into a home appliance manufacturing facility this year. At the same time, the company will also rearrange jobs for the affected workers.
Mr. Jung Hai-jin, President of LG Electronics Vietnam, said: “Eliminating smartphone production in Hai Phong is part of LG’s core product portfolio restructuring plan.”.
The decision to close the mobile business will not significantly affect LG’s production and business activities as well as employees in Hai Phong, Mr. Jung Hai-jin emphasized.
LG started operating the production line in Hai Phong since 2015. LG Electronics Vietnam is manufacturing home appliances, smart phones and car infotainment products. Yonhap estimates that this factory is employing more than 16,000 Vietnamese workers.
The Korean tech giant’s mobile business started to decline in the second quarter of 2015. As of last year, the segment’s cumulative operating loss amounted to 5,000 billion won ($ 4.4 billion).
In early April, LG announced that it would give up on the smartphone business. Some sources said that LG is selling LG Electronics Vietnam factory in Hai Phong, but the Korean technology giant has denied the rumor and confirmed that it will continue to invest in the factory in the near future.
Hai Phong City portal quoted Mr. Le Trung Kien – Head of Hai Phong Economic Zone Authority, confirming that there is no LG selling the factory. Mr. Kien said: “We have not heard of LG’s factory sale in Hai Phong. Now that is just a rumor, all of LG’s factories are still operating normally.”.
Currently, LG operates three factories in Vietnam, all located in Hai Phong, including LG Electronics Vietnam Hai Phong specializing in manufacturing electronic products; LG Innotek Vietnam Hai Phong specializes in manufacturing and selling electronic components; and LG Display Vietnam Hai Phong specializes in manufacturing LCD and OLED screens.